I would almost have to vote on 2 & 3 for your questions. I would encourage them to go even if they don't want to. Then I would sit down with him and tell him how they are feeling and what their wishes are. See if you can come to a compromise. Maybe, since he is so involved in their lives he will see how important to continue to be involved and also see how important it is to talk to the children about what is getting ready to take place.
It is commendable of your kids to want to protect you. I think that is awesome of them. Might be a good idea, though, to tell them there is no need for them to worry or try to protect you. That they need to try to be a part of his life. He is not shutting them out. After you talk to him it would be a good idea for all of you to sit down and discuss it.
I hope that all works out. It is so hard to deal with situations like this. It sounds like you are attempting to look at what is best for them. That is awesome in itself, as you can see by many posts on this site. Many could care less and are out to get the other.

I am hoping to somehow avoid taht in my current situation, but my best advice would to start family counseling or just arrange counseling for your children. If you are right and they are protecting you that's galant but not best for them in the long run and a counselor my help them understand their feelings and allow them to express them. Also, if they really don't want anything to do with his new family and express that to the counselor, you might get him to agree to meet with the counselor himself with or without the children so he can see where their feelings are coming from and not get upset at you or them. My daughter si 11 and I just had to explain to her about how daddy had a relationship with another woman and can't live with us anymore, but I haven't told her that she might have a half-brother or sister in a couple months from that relationship. I am hoping the counselor can help get me through that.

Best of luck!