Littlegreenlight, it is definitely true that kids behave totally differently at one house to the other. I can give you numerous examples of this in my own children, and my step-children.
I have had conversations with my ex, where he has said our DSs are behaving confrontationally with him, answering back etc, whilst when they have been at our house, they are beautifully behaved and polite. I have had the same in reverse - I've talked to him about one or other of them misbehaving, and he's said that they haven't shown the same behaviours at his.
My step children are the same. They can be angels here, and demons at their mums, and vice versa.
A lot of it boils down to dynamics. Your children have other kids in their dad's household, and only themselves in yours I think? My SDCs have a similar thing, whilst my DCs also have a sibling with their dad. It is a big leap going from a house where you are the only kids and the boundaries are very clear because it's always been just your immediate family, to adjusting to another house where there are other kids too, some related to you through a shared parent, and some not related to you at all, only by the situation you are in.
As for your DCs' step mum, I have been in the situation where I have been home alone looking after my DSs and my SDCs at the same time - so 4 kids at once on my own - two mine and two steps. I found it stressful, difficult, arguments were highly likely, as it is impossible to cater for 4 kids at once, when their ages range from 12 - 6. Eventually, I told my DP that I couldn't cope with it, and didn't want to do it, as it was no good for the kids or for me, and therefore, him. And I was only doing it once in a while, for a day or so in the holidays. It sounds like the SM in your situation has to do this EVERY WEEK. And she has 5 children, with an even wider age range than me. I think she is in an almost impossible situation, and I'm not surprised that she is stressed and probably miserable and suffering under the strain.
I can also give you examples of kids manipulating the situation. My youngest DS decided that what he really wanted was his mummy and daddy back together. How to achieve that? Tell his dad that his SD was mean, and tell his mum (me) that his SM was mean. Then we'd get rid of our partners, and hey presto, we'd get back together. Luckily all the adults communicated with eachother, and got to the bottom of it - DS was telling lies in order to achieve a grander aim. Maybe he has a career as a politician before him...
It's difficult, but please don't automatically think that the SM is the "bad" cop in all situations. It sounds as though she's been left in a situation that could push anyone to their limits. It would be better if she could see that you understand that, rather than leaping to attack here because she "made your DCs cry". If she's anything like me, the stress of looking after so many kids on your own, when they aren't all yours, on a regular basis, she'll have spent many an hour in tears herself.