So, take yourself out of limbo:

"W, it doesn't work for me to do partner or family activities with you while you remain involved with OM. So, we need to make separate plans for the holidays, devise a childcare schedule to split duties, figure out a budget for each of us, and so on."

No need to doormat. Be a strong capable independent male. Let go, detach. By all means, go full steam ahead with the Last Resort Technique, it is pretty much where everyone who makes it to these boards should start:

MWD
Last Resort Technique strategies
Stop the chase
Do not initiate any contact (unless child-oriented)
Be friendly but brief if contacting
Be unpredictable
Be upbeat
Stop saying, “I love you”
Quit convincing spouse the marriage has been good or can get better
No relationship talk
No requests for reassurance
No resistance to negative comments
Get a life

There is more in the DB book, and also more on MWD blog here: http://www.divorcebusting.com/blog/how-to-prevent-a-divorce-the-last-resort-technique/

Basically, QUIT BEING A DOORMAT mooning and moping over wife.

Of course, if you are really prepared to divorce her NOW if she doesn't stop contact with OM, then sure, go for it: "W, I know you are involved with OM still. Unless this stops immediately and you are fully transparent, I will file for divorce tomorrow." But, you SHOULD NOT do this for effect, or to try to jolt her to reality. You SHOULD ONLY do this if you truly want to act swiftly if you don't get what you want. Given she is asking for IC and MC, the timing of this move is very questionable to me.


Best,
Oldtimer