Where you live is really not her concern anymore. As long as your buddy isn't doing drugs or having orgies at the house, then she can't keep you from seeing your kids.
She is obviously not detached, but she's driving this thing. I think the reality of what she's doing is starting to dawn on her.
Get Dr Phil's Relationship Rescue. It's great for communication. My H and I had similar communcation issues. This book really helped change the dynamics of our R. You can implement the changes by yourself. When you change the way you communicate with her, she will have to change her style to you.
Also, when my H and I were separated, I told him that I knew that we both made a lot of assumptions when communicating with each other. I knew that I had made mistakes in the past by not telling him the truth about how I felt. But that from that point forward, I was committed to being honest about my feelings, etc and I would not say something that I did not mean. I would also not assume that he meant something other than what he actually said so he should please tell me exactly what he thought, felt, etc.
A statement like that to your W might help. She's making a lot of assumptions about what you want, how you feel, etc. You need to make it clear that this is a negative pattern and you want to stop it. If you notice in the above example, I used all "I statements". That's very disarming because you're not blaming them just stating what you are willing to do.
