I am sorry to hear about your husbands illness.
Still, it does not change my view on the situation. Other than, it makes it even more important for you and the children to not have any other family rifts, as they are time consuming and draining. Because I think there will be a rift if you are seen to shun the wedding. It would seem that you condone your husbands views, and that is why you stay away.
I was talking to my husband about his grandfather the other day. Not that this is relevant, but we concluded that people are rarely remembered for all the good things they do or have done, sadly what stick in peoples mind is their wrong-doing, usually.
Take your children, celebrate your brother and his partner. And know that you have done right by your brother, and right by your family.
Does your dh really want you to cause a feud in your family, by standing by him and his bigoted views? If he really feels bad about what he said, he would realize he has no place at that wedding, and he would realize you should go, because it would be the best step towards putting this behind you all, rather than widening the issue.
You may see a need to talk about this with your brother, but I am not so sure your brother would want to have this discussion, so I can quite see why it best be left unsaid. You need to respect that. What could you, or your dh possibly say that would make it any better? Your brother must have been SO embarrased and humiliated. Why would he put himself through the fresh humiliation and talk about it?