I guess I got confused because I thought your wife was saying "I'm not dating anyone!" and you concluded that her affair didn't work out and she was starting to face the consequences of her decisions and hit rock bottom. How do you know the OM is still in the picture? Maybe he's not.
I think you could invite her or have at least a private family party in addition to the big one. Private meaning you, your wife, and your daughters go out to dinner together or have a cake and gifts together at home. I thought I read somewhere that family time is still acceptable.
I think your actions are going well. You do seem to be taking a very strong and cold approach though so I do think an act of kindness here-or-there might help. It doesn't mean you'd take her back easily. It just shows that you're still a good person and hopefully it'd be a reminder of what she's missing.
