Not sure about giving her options on the bedroom. I am still holding the view that she left the home and M bed and I think I would hold my ground on that.
I agree on you keeping the master BR.
I don't know your home set-up, but figured there was more than 2 BR's and possibly another room or even a basement she could fix up as her own place. Even a little remodeling would be easier on your budget than carrying two mortgages/rents. Imagine if she could be in home but somehow still feel she had her own space.
W and I have been in house separated for the duration, and it works for us. You just have to give her space. Oh, and I reclaimed the MBR early on.
Take your time, it sounds like there is no reason to rush things.
M: A really long time. Crisis: 5 years. She's still worth it.
Life is never made unbearable by circumstances, but only by lack of meaning and purpose. -Viktor Frankl