I honestly believe you and your children are in grave danger.
This man could be my father. There is so much I want to to say, but the biggest is that you must be very careful how you go about leaving. My father was a lot like this and when my mum starting talking about leaving and trying to leave... I can't really describe it, everything escalated. The mask finally came off basically and I saw what was underneath the 80%.
He did not want my mum to leave and he was willing to do awful things to try to stop her leaving, even if he disadvantaged himself in the process. This is because the abuse comes from a need for control and a sense of power. You leaving with the children will result in a massive loss of control and power. I was a young adult, and it was hell, I can't imagine putting a 7 and 5 year old through it.
My mum thought he'd react with anger, but at first it was tears and begging her to stay. Then claiming he was going to kill himself and talking through how, and how me and my brother would never forgive her. He then started talking about killing us all so we'd always be together, suggesting setting fire to the house or crashing the car. There were several times when I thought he might seriously injure or kill my mother, me or my brother. Nights spent huddling in terror in the same bed as her. His own family thought he might kill her, too. I was getting calls off his sister, hysterical, saying he was out looking for my mum. He used my brother and I to manipulate her. One night he had been doing his best to make me cry so he could put me on the phone to my mum, saying she'd done that to me and I needed her. It was just to get her back to the house.
We didn't realise it was abuse to begin with, we thought he'd had a mental break and the he needed psychiatric care, as it was such an escalation. He ended up in a private mental health hospital from which he continued to harass us via his family and over the phone. He also got sectioned by the police after showing up at my mum's work and kicking off, claimed to have overdosed, but he was released as it was decided he was 'emotionally tormenting' us rather than mentally ill. I was getting texts about him having possible cancer, everything he could think of so I'd engage with him.
He repeatedly tried to harm and mentally abuse my brother and I to use us against mum. He wanted us to say we'd never see her again if she didn't come back to him and offered bribes. Which was when I realised he'd never loved us. I used to think deep down he must love us really purely as he was my dad, and he wasn't always terrible, but actually, it was all about my mother. About keeping and controlling her. He didn't care, and had never cared, what his actions did to his children. We were possessions and tools to use against her. If he'd ever cared, he would not have ever started being abusive to begin with, even with times in between were he seemed 'normal'.
It went on for months. I had to flee the family home with almost nothing and I was homeless, living between different relatives and with my boyfriend's family. He stalked us all, I was constantly afraid he'd turn up where I worked. He was even harassing my elderly grandfather, calling my younger cousins to shout about us and he sent people into where I worked to try to get me to speak to him. Sending messages about our individual roles in killing him followed by jewellery and flowers.
He got warnings from the police, but no one really did anything to help us. The police were a mixed bag, but while several very much wanted to help they couldn't do much due to the law (coercive control was not a crime yet). I once sat in the GP surgery sobbing, begging for help from my GP who just said if my dad loved me he'd come into the GP surgery and he'd listen to me as I was his daughter. I kept trying to explain my dad wasn't like that, but he wouldn't listen.
It was the Samaritans who told us it was abuse and encouraged us to essentially go into hiding (which shocked me because I didn't think they were supposed to give advice, but the lady we spoke to was frightened for us). Women's Aid, when we finally found them via Google, were horrified by our experience and said we were in serious danger, because this sort of thing can be the precursor to greater harm or murder. They were amazing. They understood it all in a way no one else had.
We finally got a very good young police officer who recommended a non-molestation order. This is a bit like a restraining order which would allow the police to protect us. Between this and Women's Aid, we finally got some freedom and support, including counselling for my mum.
However, I have needed so much counselling afterwards myself, and I will always carry scars. The abuse before was bad, but that period of escalation left me especially traumatised. I'd do anything I could to protect young children from anything close to that during a separation from an abuser.
Based on my experience, I think the best thing to do is not to discuss leaving at all. Instead to act like everything is fine now and make plans to leave secretly. Make sure you have all key documents and sentimental items and just leave suddenly without any sort of warning. Go somewhere he can't find you or the children, then handle him through a solicitor.
If you had to stay in the family home or somewhere he knew where you are, I'd change the locks, get CCTV and an alarm system. Again, all contact through a solicitor only. Call the police if he contact or comes near you, repeatedly, if only to have a record you have done so.
I's say I don't want to scare you, but I do, because you should be afraid. If you are afraid of him then you will take the risk he poses to you and the children more seriously.
I am thinking of you and your children, and very much hope you manage to get out safely, without experiencing further harm.