Glad to see you responded to Mach, simply because he is so smart even if he is a little hard sometimes.
Your letter, wow does it scream issues. And it screams she has no idea which direction she is going. So as for advice, personally, I wouldn't give up just yet. It will be a really bumpy road, and you and she both may decide that it isn't going to work, but now is not the time to walk out. She knows what her issues are. At least at a surface level. She just has no clue how to change this stuff, because what she has tried to do, to win her father's approval, has not worked so now she is questioning if it was the right thing to do. You wife needs to realize that whether she gets his approval or not is not the measure of her worth. She gets that she has to make herself happy. That is really a good thing. Now she has to be strong enough to try things, until she finds her own happiness WITHIN herself (see that is the real key, happiness comes from within, not outside of us). I won't lie to you. This will be painful for all of you. It will be hard. She will do things you won't like, won't approve of, and you will often want to walk away, if you choose to continue to try to stand. Once she comes to realize that she holds the keys to her own happiness, she can then really decide about the marriage, what type of mother she wants to be, etc...
In the meantime, detatch. Work on yourself. Protect your kids as much as possible. Decide what you want. Listen, validate, and work on you. Start with the controlling, you may not have felt controlling, but your W thought you were. Best thing to do, let her find her way, without offering an opinion if possible, show no approval or disapproval of her actions. Read, learn, I can't believe I'm going to suggest this to you, but you might want to read The Love Dare. It is about unconditional love. I wouldn't suggest actually doing the dares yet, but reading each one and pondering the questions will teach you a lot. I have another one that is also about unconditional love but the title escapes me at the moment so I will post it in the morning. That is what your wife, and all of us really, but your wife is screaming out for. IMO.
Others might not quite agree with me but... I would love Snodderly's opinion so hopefully she will drop by.
"Acceptance doesn't mean resignation. It means understanding that something is what it is and there's got to be a way through it."--Michael J. Fox