Girl, I left for exactly that reason. That I did not want my kids to see my W being rude and disrespectful to me, and vice versa as I am sure there were times that was true.
Personally, I think that it's best to stay in the same house as long as there is no violence or abuse. If there is, then a person MUST do what is safe.
As far as the kids go, I again am a believer that they deserve to know what's going on. I mean that in an age appropriate and parent/child way.
I asked my W to have "the conversation" with the kids. She just wouldn't. So I sat down with them (each at different occasions) and had talks with them about how things were changing as far as family was concerned.
'cause otherwise... they KNOW something is not "normal" or "right" and they have no real resources to help them understand... and if they have no reference, they have to "make up answers" in their head to make sense of it all...
There should be resources available on the web to help explain to a 7 yr old that there's problems in the family. If you can find something that works for you and just help your S7 put his thoughts and feelings into perspective...