Hi there!
Wow, what a predicament you're in.
I would want to know more information about what your hubby thinks of all this, afterall, this is HIS side of the family we're talking about. Is he even close to SFIL? Did SFIL help raise him or anything? What would your hubby like to see happen here? I'm glad to hear you are voicing your concerns to your hubby to see what he has to say about it.
However, your hubby asked you about dinner. This signals to me that he may not be feeling as strong about the whole thing as you do. You are, afterall, basing your feelings about SFIL on what MIL is saying, and not personal experience with him, correct? MIL's feelings about SFIL are very emotionally charged right now. And I think we've established that MIL is not always the best judge of character? Just because SFIL is allegedly treating MIL poorly does not mean he would do the same to your children.
My strongest recommendation, though, would be if you are still highly concerned about SFIL- meet with him in public. There are plenty of community play areas where you all could meet, and plenty of restaurants to have dinner. It doesn't sound like he has a strong tie with your kids, and chances are he wouldn't want to see them often, especially after the upcoming divorce.
I'd be more concerned about MIL moving next door heh....
Good luck to you. If you would like to talk further about this, you can email me at ____@____.com.