Marooned, I wish I had something positive to give you. Whenever the parents on either side are involved to the point they are interfering in the M, that is a very serious problem. It is a very unwise parent who enables their child to break the bounds of M, but it happens all the time. Either the parents are selfish or too weak.
My advice for you is to stand your ground as your own man. Protect your child as best you can. Do nothing to financially enable your W living apart from you. Do not crumble under the verbal slaughter that her parents will probably say about you. However, do not take their disrepect, or hers, to your face. You do not have to endure any bad treatment. You need to keep your distance from them b/c right now they may be trying to encourage her to stay separated and the more you are around them, the worse it could become. Oh, and you could probably not make brownie points with them, so I wouldn't even attempt. They think they have their little girl back, right?
Unless something specific happens that will turn the W back to her own home, H/M......she will probably end up actually choosing between what her parents are encouraging and what you want for the two of you. An immature woman can make bad choices and I hope she will get her eyes open soon.
Is there an OM?
Except for your child, I believe in hard detaching. No contact with her or her parents. Never do anything that hints of pursuit.
It is not about what you feel should work in your M. It is about doing the work that gets the right results. Do what works!