Sad - You have to do what you feel in your heart and soul is the right thing to do - what happens after that is out of your control - but you will sleep well at night knowing you are living by your convictions and high morals.
If you want to be the best possible parent you can be, than focus on being the best parent possible. A woman and mother has a very difficult time walking out on a man who is incredible with her children who are the most important people in her life.
Instead of moving out - move to another room of the house. Do things separately from each other. Stay out of each others way. Do not argue with her about anything. Just tell her you WILL NOT walk out on your kids.
Have such a great time with your kids that your wife will want do be a part of it too - not wanting to be left out of such great times. Do not do anything to actively pursue your wife - she doesn't want it. But if she wants to tag along with your great times, that's fine.
Good luck - things can work out under the most dire of situations. It just take time and WAW seeing that life on her own is not all that great.
Me:40 / W:33 / D:3 T:7.5/M:4 D Day: 1/24/08 Legal Separated: 6/12/08 BF who sleeps over: confirmed 11/10/08 Suspect BF pre-dates D Day