@strawbroke I do think you did the right thing to intervene and defend your son from your father's attack (and that is what it was). I can only imagine how distressing it must have been for your son, but I would hope that seeing you intervene to defend him and counteracting what his grandfather had yelled at him will have a significant positive impact. Your actions speak loudly.
I don't know if you'll read this, which would be understandable after some of the comments you've had. I'll post anyway in case you do or it helps someone else reading.
I completely get why you want to protect your children from the knowledge of what your ex did to you, but it also jumped out to me that the questions they'd asked you about him were observations of abusive behaviour that they had noticed and had picked up on and had remembered and probably had worried about. You know this, but abuse is about far more than the violence to which it may or may not eventually escalate. They witnessed the rest of it.
You went through MARAC and all the rest, but did you ever get the chance to do the Freedom Programme? (Www.freedomprogramme.co.uk) I ask because it covers a) how children are affected by abuse even when we think we've managed to hide it from them, b) how they heal in the aftermath and can be supported, and c) all the ways abuse manifests before it escalates to violence (so all the other things the children could have heard or seen or experienced even if they never saw the violence).
I think you're right that your son's anxiety is trauma related. Which must be heart wrenching, but it also means an improvement and resolution is absolutely possible. And that is what I would hold onto. The hope.
I'm sure you're aware of this, but children don't have the perspective to understand that their dad was targeting his abuse at you because of his own beliefs, not because of anything they had done. My fear would be that in the absence of you taking charge of the situation and talking about it with them that the only way they've been left with to understand the arguments and shouting they used to hear is that "I'm bad and I made daddy angry". It's such an incredibly common response for children in that situation I'd be more surprised if they hadn't absorbed that idea - so I'm not saying this as criticism or judgement of anything you've done. It's just how children understand the world.
I can't help wondering if one of the greatest things you could do to help your DS2 to recover from this would be to have that tough conversation about what went on and why it went on, and unequivocally tell him that it had absolutely nothing to do with him, he didn't cause it, he didn't influence it, he didn't make it worse, it wasn't his fault for not protecting you, it wasn't his fault for being afraid, it wasn't his fault for anything - and it wasn't his responsibility to stop it etc.
If you start the conversation and lay things out (obviously not in graphic detail, that's not what I mean) and begin by listing the ways it wasn't his fault or his doing etc etc, and why, it may well give him the chance to feel able to ask you about things that are worrying him. He might feel too ashamed to say "it's my fault for hiding under my bed instead of telling daddy to stop, isn't it?" without you first initiating things, but it may well be the kind of thing that's been going through his mind and that he won't otherwise feel able to dare trusting anyone with. (Who would if you're expecting the answer to be "yes, it's your fault".)
I know it's a bit cliched, but I really do think knowledge is power in this situation.
And genuinely, I think you're doing brilliantly to be doing all of this to protect them, help them, defend them, and build a better life for you all. It cannot have been easy, and I have so much respect for you for having gone through all of this and to still be standing.