Did she tell you she was autistic? Is your husband in any way a bit vulnerable himself, or suffering from MH issues? This just seems like something out of a surreal bad dream. I can't imagine that an otherwise sane and well balanced man would do this in the space of 24 hours. I can easily see that he might have had a ONS with her, but I can't see that he would sit back and tolerate her messaging you saying the things she has said unless he has lost his mind.
But then, as the title of your OP says, He has lost it. 
I know she's the OW but she does sound vulnerable. That's for her friends and family to help her with.
You need to protect yourself now.
That is very sound advice. She is not your problem, he is. There is little you can or should do about her, don't concern yourself with her welfare, just screenshot everything then block her, do not engage, she is deluded. It's concerns me that someone so vulnerable, with such out of whack boundaries is parenting a child, but again that's not your problem.
I imagine this will end in enormous amounts of grief for him when he comes to his senses and tries to extricate himself from her , but that is his problem not yours.
Pack up his stuff and take it to his parents house. Tell them exactly what he has done. Have you got someone to help with childcare this week?