My wife wants to tell them this weekend and say it was a mutual decision. I told her if they ask me, I will tell them this is not what I want, but I want Mom to be happy. I like the idea of having her tell them she is filing for a divorce, but I just don't know if that is best for the kids.
Your wife is right. You should tell them it is a mutual decision. Should your wife tell the kids that you were looking at porn when she was pregnant and probably masturbating while doing it? Should she tell them you always wanted to have sex with her when she was sick and it didn't matter how she was feeling? AND these things are some of the reasons she wants the divorce? Or don't those truths matter?
Be careful here on trying to put this on your wife with some of the things it looks like you have done to push her away. What is best for the kids is to tell them it is mutual and just let them know that they are loved and that it isn't their fault. Leave the who wants it and who did what to who out of it. They don't need to know.