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Hello Kathryn,  I know you want some answers and some preparation for what you are about to face.  I see it as not really knowing what will happen, how hubby is going to react, what your children will want from all this.  We can’t really control what they will think and what they will do with this information.  I do think though that this "bitch" should not be involved at all with your family and your husband. I am sure you husband does not want anything to do with her either. The child, however, could be a part of your life and your family, depending up how your husband feels and what he wants for this child.  Do you know what he wants, should this child really be his?  Have the two of you made any plans on what you are going to do, if this child is his?  Kathryn, don’t let this destroy the marriage you built up over the years.  The incident happened when you were broken up so it’s not like he cheated on you and also, he knew nothing about this child until recently.  
Just my opinion but I would talk with hubby and work it out somehow with him first.  Things have a way of working out so don’t stress so much right now. Wait and see what the results are and then take some action then.  Good luck and I wish you well.   Danielle