I forgot if you mentioned it earlier...does she own the house? If not, then I'd kick her butt to the curb. That's what I did to my W and I believe she respected me afterwards for it.
If your W is still going to pursue, then let her. I would even go so far as to warn the other guy and remind him about his W. He doesn't know how much you know and neither does your W. Let that fear linger over their heads. Or at least the OMs head. At least you can put a stop to that.
Right now your W is talking like mine when she was attracted to her boss. She was so "in love" with him that she wanted to leave everything for that. Truly pathetic.
M-43 W-40 2D - 9 and 5
Emotion, yet peace. Ignorance, yet knowledge. Passion, yet serenity. Chaos, yet harmony. Death, yet a new life.