His parents are great with the kids. They provide a lot of childcare
So, why wouldn't this continue, whatever happens? I provide a lot of child care and if there was a separation/divorce, I'd hope to go on providing it. They are unlikely to be doing child care at the moment just to help their son - I imagine they enjoy their grandchildren and feel some responsibility for keeping their (the grandchildren's) situation stable.
In any case, no counsellor is going to decide for you - it's your marriage, and you two decide when and if it ends. You haven't even had the mediation sessions yet, and relationship counselling isn't a fast process.
Keep calm and think this through - mediation and counselling may help you to reach a solution, but nobody can decide for you. Your DH is probably trying to provoke a reaction. Don't fall for that. Say you both need time to work out what's best for the children and that you're not ready to make that decision yet.
There is a chance he may just move out, of course - just as you'd planned to do. Yes, I'd think that was an easy way out for him, too, and irresponsible. From your children's point of view though, it possibly wouldn't be so upsetting to "lose" him - you're the one they've been (mainly) reliant on since they were born.
I hope both of you can move on from seeing this as a competition to escape - at the moment, it does read as though neither of you is actually keen to have the children full-time, and that is very sad for them.