This is the very worst kind of shock for you OP.
Their story had been cooking away right under your nose in your own home while you have been so trusting.
I can only imagine your thought processes as you try to understand where you and your dc now stand and what the future holds for them.
He clearly didn’t want to lose her from his life so couldn’t bring himself to end it, keeping her simmering on the back burner. You will no doubt be asking yourself …did he want me to find out.
The terrible betrayal by her too OP, not only of you but worse, of your children too. She accepted your hospitality on several occasions, whilst all the time in love with him and lying about her reasons for being in your house and around your children. So again, you will probably be asking yourself …was this all part of the plan for an easier transition when he eventually swapped you for her.
And now you have a massive dilemma. You can never trust him again but you know he will go straight to her and she will make it all very easy for him. She has already wormed her way into the lives of your children, smoothing the way for their step-child futures, no doubt with step sibling to complete her happy picture as soon as she can.
My immediate instinct would be to want to scupper that plan (if that’s what they are thinking)
Your hurt must be crippling.
Take your time getting every last truth out of him before you decide what’s best for you and the children.
You have a right to tell her what you think of her now she has been outed as the worst kind of most despicable betrayer possible, totally unworthy of being anywhere near your children.
Under the pretext of wanting to keep his family together, he has royally screwed up your lives and showed how weak he is.
There is no right way to deal with it all, only you can decide, once you know the facts for sure and once your emotions have settled a bit. Take your time. Wishing you all the very best.