Unfortunately, bewunce, YOU can't fix things - at least, not in the way you're striving to believe it can be done. Deep-seated issues like finding sex disgusting (and I guessed at the possible bi-sexual thing, too, this is not unusual) cannot be fixed by an effort of will - not even by the affected party, never mind someone else! It's madness to pursue that line of thought.
There's a strong element in your posts of your taking responsibility for your husband's life, feelings and even his knowledge of everysay things. Please stop mothering him like this. You've slotted perfectly into the role of Mother, to him as well as to your children. Leaving aside the obvious implications of this for your sexuality, it's bad for you and for your family's relationships in general.
It is impossible to have a good sexual relationship with somebody who finds sex revolting. It is impossible to get him to address his evidently deep-rooted issue. Therefore, it is impossible for you to [re?]gain a happy sex life with your husband.
Lots of people do have sexless marriages. Time was, not so long ago, when couples were embarrassed to admit they did have sex for fun
You're a million miles from alone in this. There are many coping strategies. You're wise to have reintroduced affectionate touches to your communication - not for targeted purposes, but because touch is an extremely part of human interaction; presumably you both want to remain close, so this was a constructive move.
As to the baby business - well, you can DIY artifical insemination as others have mentioned. That, too, is more commonplace than you probably think. It's very easy to do, as long as he can ejaculate into a clean jar. Or you can adopt. If you're living in a less-developed country, aren't there hordes of unwanted children just desperate for a truly safe & loving home?
You seem understandably sensitive about all this so I hope I'm not coming across as harsh. I know what you mean about getting used to it. I haven't had sex since 2005 (am very single, by choice) ... but my pre-divorce years, living a relationship without sex, were far harder and more painful. You simply must come to terms with the facts as you've laid them out, for your own mental health as well as your family's happiness.