DrowsyDragon
re your comment on your parents:-
"The boundaries DH raised were previously discussed with him and me and I agreed to them and modified them before the conversation with parents. I am not great at conflict with them. I either become very upset or start trying to placate everyone."
Yet more unwanted legacies i.e people pleasing behaviour and toxic fallout here from being raised by your parents who are abusive themselves. Your boundaries, weakened by all this from them anyway, are being further eroded now. Setting boundaries as well is probably very hard for you mainly because you were encouraged to not really have any.
Controlling behaviour is abusive behaviour and stems from wanting power and control. All of this is on them, you are and were never responsible for their behaviours.
re your comment:-
"My ideal at the moment would be a polite but limited relationship with them while DH and I work on everything but one that allows DCs their relationship with their grandparents"
That is not going to happen. You've been controlled your whole life by your parents and they still very much control you as an adult. Your fear, obligation and guilt re them remains very strong and you seem far more afraid of them and or wanting their approval than you are of your H. Your own inertia too when it comes to your parents hurts you as much as your own family unit comprising of your H and your children. Who is your primary loyalty too; your parents (who will never give you their approval) or your own family unit?. Who is more important too, would the sky really fall in if you were to start saying no to your parents more?. No it would not but you've been conditioned to believe that it would.
If your parents are too toxic, batshit or too damn difficult for YOU to deal with, its the same deal for the children as well. People like your parents tend to be awful as grandparent figures and neither have really changed since you were a child yourself. Would you really want your children around them now, ask yourself why if that is the case.
What did you learn about relationships when you were growing up?. Your parents likely as well taught you to be codependent as well as people pleasing (this also stems from a lack of self worth) and all of that probably also led you to you being with your H.
Do not further get stuck on the sunken costs fallacy; all this about not wanting to throw the towel in is really just that. Its a way of avoidance against noticing yourself. Thinking about what already has been may prevent you from deciding what you want your life to be.
I would suggest you read "If you had controlling parents" by Dr Dan Neuharth.
You have a choice here re your parents and DH; you are an adult with agency. Never forget that.