I'm so sorry to hear your news. I am in the same situation unfortunately, my dear dad was diagnosed with terminal cancer last week, he has weeks to live, and has been sent home to die. My mum is 81, and the strain is tough on her.
My advice is to try to take each day as it comes. For the first few days we were emotionally all over the place, so many questions to be answered, and no idea who to ask.
But gradually things have come together, and we are all now a bit calmer. Dad has carers in 4 times a day, and Mum can call them 24/7 if she needs help. Your FIL should be allocated a MacMillan nurse, it took about 6 days before we met her, but she has been great, and again gave Mum a number she can call 24/7 to get help or advice.
macMillan have a good website, including advice on how to tell children. I have three children, aged 12, 11 and 8. I decided just to be honest with them. Children very easily pick up when something is wrong, hushed conversations and brushed away tears just make them worry more IMO. Unfortunately death is a part of life, and you can't shield them totally from it, or it will become something secret, a scary thing not to be talked about.
It's a long tough road, but as a family you will come through this together. Sending hugs x