M.M.
Unfortunately, you can't do anything - you were right, she has to want to leave. You could call DCF and inquire about the details if they take the kids - where would they go/ would you be able to take them? If her kids are taken away maybe it will convince her of the severity of the situation. Once his kids try to get in the middle to protect their mom, he will hit or shove them to get them out of the way - maybe that is what it will take for her get the picture. I am assuming your father isn't physically able to stop this man but why would he leave the house if he knows this man could physically hurt his daughter!!!!!!! Since the father does not hide his actions from his kids or the father-in-law - that shows that nothing will stop this man and it will escalate things most likely to a near fatal or even fatal occurrence.
I am so sorry for you and your family. I have been abused and the abuser has an extremely strong pull. Fear is what keeps her there, although she will say it is love and he really doesn't mean it, but fear is the real reason. Being abused is like a drug addiction, she won't take care of herself until she has hit rock bottom, i.e., her being put in the hospital (although, that typically isn't enough either) or the kids being hurt.
Continue to offer her support and be there for her NO MATTER WHAT. Don't be judgmental in her presence, just be her sister. You can always offer her a place to stay, no questions asked - she may feel she has no where to go b/c she doesn't want to burden anyone w/ 4 extra mouths to feed. If you ostracize her or constantly badger her to leave she will only cut ties. If she has no support system she will never leave him b/c she will feel she is all alone.
I know this isn't the answer you wanted to hear. I know you love and care for her deeply or you wouldn't be reaching out for help. All I can say is be there for her. I finally got the courage to leave my situation b/c I knew I had somewhere to go - my family always made it clear I could come home.