Op I agree with you in that he is being selfish, he has changed the goalposts.
The phrase that jumped out at me is apparently he’s not spending out on two cars in one year. Fine, tell him that he doesn't have to spend on 2. You will spend on the second one (using money from savings). You can be as pedantic with wording as he is with the money!!
I hope that some of the savings are in your name too, not just his?
Yes it was his inheritance, but surely paying off the mortgage means there is now considerably more spare money per month, for either of you to decide how to spend? Or does he have the last word on how money is spent?
I also had an inheritance from my mum 2 yrs ago, plus a lump sum from my employer being unexpectedly sold (I had had shares for years). The cash went straight into joint savings, as 'our money'. I did change my car last year, for a nearly new one, DH can also do same if he wants, but he seems happy running his down for a while. He has always wanted to do a camper conversion, which there is money for, but we have a few items in house to sort first, plus buying DD a run around when she passes.
We have discussed getting a holiday home too, which would be instead of camper, but it would be a joint decision. In the meantime both ISAs are being topped up. Kids got an inheritence of their own 2yrs ago, which is topping up their ISAs.
Maybe ask him how he would feel if it was your inheritance and you had prevented him updating his car?
I could understand no second car if it meant not clearing mortgage, but given that you have done that, topped up savings etc, then why cant you have a car?
Whereabouts in US does he want to go, and how old are DC? We went west coast last year, 3 wks with some travelling around. It was tiring, ours 19 & 17 and we still had grumpy kids on some days!! We all agreed it was a wonderful holiday, saw and did some superb things, but not restful in the slightest.