I think you should tell them. The fact that so many others know, and they could hear it from someone OTHER than their parents, outweighs everything else, in my opinion.
I also think some time with one parent is good. In fact, it is the "one big happy family Fun Days" -- after they've been told of possible D or S -- that tends to confuse them.
"Normalizing" refers to the cheating spouse trying to get everyone in their life to be "OK with everything," and I think it's more about the ADULTS. Kids need both of their parents, first and foremost, and as long as she's not lying to them, or putting them in any unhealthy environments, I think some time alone with each of you would be good.
Your wife also needs to feel what it would be like to single-parent them, without you. She may not like it.
