I have four kids and two soon to be step-kids. I applaud you for that.
This is a touchy situation. I know that his mom is trying to help the situation and so is he by keeping those cards and things from the kids. The thing is, it's going to come back and bite them both in the butt. She's going to say she sent things to the kids over the years and they will find out they were kept from them. Imagine what's going on in their minds, they think their mom doesn't love them or care about them. That turns into other things and it will affect them forever. Now when they find out they felt that way all along and for nothing, you will find they turn completely loyal to their mom and the rest of the family will take the fall for the betrayal.
My advice is this. Sit down and talk to him and decide together what you are going to do. Start giving the kids the letters and things. Sit them down and tell them that their mom loves and cares about them but she has many issues right now that's keeping them apart. She isn't in a place right now to be a mom to them and please tell them that she WILL disappoint them, tell them you don't say that to be mean but to prepare them. (this was a very important step with my daughter when her father popped back in to her life. It prepared her for the heartbreak). Let the cards fall where they may. She's still their mother and that will never change. You have to see it from their point of view.
The most important thing to remember is to always keep their safety first, be a soft place for them to fall when they do get hurt, most important remember that doing what's best for them, sometimes it hurts and it's not what's best for the adults but it takes a big person to see that. I always looked at things through my child's eyes. She wants nothing to do with her biological father but she's not mean or bitter, she's a great kid and her "dad" is the man that raised her.
Good luck whatever you decide hon! It's a rough road to travel.