You know...that's a very good point. Some women (not all mind you) are very threatened by X's, especially if you still have a good relationship with them...even if it is for the kids sake. So that may very well be an underlying motivation for your wife wanting to move a bit further away.
Don't get me wrong...I'm not saying you should up and move for that reason. The fact is you do have children with your X...if your wife is threatened by your X she's going to have to deal with it at some point...she's going to be around for awhile.
In that aspect I'm not in your boat...but I am (or was) still friends with my 2nd husband. His current wife was and I assume still is very threatened by me. It was my choice to leave the marriage (severe alcoholic, recovering now) so she knows had I not left the marriage would probably still be in tact. Once I stopped being angry with him for all the pain he'd put me through (rejecting me for alcohol) we were able to become friends again...and had he not been dating her when I stopped being angry we may have reconciled. Anyway...sorry I digress...do you think it's possible she's uncomfortable with the fact that you do live so close to your ex? It really is a point worth looking at.
Good Luck ! Hope the evening went better than lunch