Parenting is a challenge and dealing with it when separated or divorced just throws a wrench into the mix.
I think being in limbo probably is worse for him, but I doubt it has to do much with the trouble he is getting in at school - that I believe is more peer pressure and the nature of boys.
Instead of counseling, maybe the best thing is some sort of consequences and rewards system. There are numerous web sites (about.com, parents.com, etc..) that have discussion of techniques.
As far as the game systems, I really have to limit the use mostly because of S8 getting hostile when I tell him to stop. You are good in not getting him started on that. There will come a time when he has friends that have it and then you are going to have to make a stance.
BTW... When I was a kid, there was a very large group of us boys in the neighborhood and school that would play "war" a lot and parents/teachers back then did not seem to care.
