I got to tell you that I am hugely impressed to read how you are coping in a tough (to say the least) situation. You are fantastic, and you are doing more than great! So inspirational. Don't forget it. I feel ashamed of all the self pity I felt a couple of years ago when my marriage was going south.
I only want to repeat what others have said - you have to be very firm with your husband regarding what he can talk about with the girls. It is absolutely unacceptable. And you have to do it now. They are the ones who suffer the most from this sitch, so they do not need additional pressure.
About comparing to the OW - this is ridiculous. There is no way a woman willing to be in a relationship with a man who just abandoned his pregnant wife and 2 kids is better than you.
Merry Christmas and 2013 will surely be a lot better than 2012