Good for you for insisting that he be honest with the kids. It sounds like you handled that well, and that he hadn't even considered it.
When my H wanted to tell our D that he was leaving, he wanted to tell her we were amicably separating. I insisted on the same things as you -- that he can come up with something to tell her, but it had to be the truth (he was leaving), and that I would back him up.
It sounds like you are doing all the right things, and your H will have to face the music with the kids eventually. Sadly, a lot of the MLCers mentally diminish the effect on the kids to spare themselves the guilt. I hope he is starting to realize the mess he's making.
M: 43 H: 39 D: 14 Married 15 Together 16 BD: 6/2014 S: 8/2014 OW revealed 10/2014 Instigated dissolution 12/2014, in progress So over it!