I hope you will take the time to read those links Cadet has posted. It sounds as if you are doing a good job.
Besides her sleeping in a different room, has anything else changed in the family routine? Do you still share family events and celebrate holidays together, etc.? If so, how is the interaction between you? How much of the housework do you do, and how much does she do? Who mainly takes care of the kids? What about the weekends? What's the usual routine?
I want to encourage you to read about setting boundaries.
She is going through a crises, and putting you through one, too. It must have been terrible losing both mothers in a short period of time. Did she have her surgery before or after her mom died? Had been overweight most of her adult life?
If she was always overweight, then she may not know how to handle the male attention and has gone a little crazy with it. The first A induced certain feelings, and now she craves that feeling. She may be in contact with more than just one man. This is a thrill for her, feeds her ego, and it is also dangerous.
I can identify with the online stuff, and was in an Internet A when I first came here. I can tell you that she won't "feel it" for you as long as she's involved in this sort of activity. Even if it makes for a good soap opera story line, most women just don't feel in love with more than one man at a time. However, she may get so messed up that she starts playing around with more than one man at a time. Doesn't mean she loves them, she's just experiencing having this new, sexy body.....and being a girl gone wild. She is probably in for a big crash landing, sometime down the line.
My question is do you know where your boundary lines are drawn? What would it take to be the deal breaker for you? If you aren't sure, then you need to think carefully about it. I have a feeling this could get much worse, before getting better. I am so sorry for you and the kids, and I'm sorry for her too. All of what she's experienced could have something to do with what's happening now. It doesn't justify her behavior, but sometimes the LBS would like to just understand "why". You may never fully know, but you can get support here...if you'll stay with us.
It is not about what you feel should work in your M. It is about doing the work that gets the right results. Do what works!