Maybe I'm wrong, but my thinking is that if she is sincere in truly wanting to reconcile she will stop the R with the OM. My fear is that if I offer to attempt a reconciliation (and I'm no where near that yet) she might accept, but not for the right reasons. More because she needs financial support and needs someone to pay (literally, not figuratively) for her child.
CB,
Check out this site. http://www.bpdcentral.com/bks/spy.php Your wife's mental illness is dangerous to the safety of you and your children. Protect, Protect, Protect.
Personally, I wouldn't even consider a relationship with your wife until she had completed several years of therapy and/or medication.
Before you decide if you want her (w/ or w/o child), can your wife be in a stable relationship with anyone at all?