Your right. Wished I would have had hindsight many times in my life. If he is not willing to reason with you then it doesn't leave you many alternatives.  I will never understand how hatred factors into decisions when it comes to children and it sounds like he might be up for using them as a pawn but trust me it will backfire on him so bad. Maybe not today and maybe not tomorrow but sooner than he thinks.

Hatred begets hatred.  He also has a lot of growing up to do especially if he is blowing money and then allowing your parents to bail you out and turning around and being spiteful and hateful when your mom comes to your defense.

Shame on him. Hopefully, soon he wakes up and smells the roses because this won't get him anywhere and he will be hurting your children and putting them in the middle which is really kind of sad.

I am glad your children have one sane parent (you) to keep things in perspective.

You sound smart!

You have to do what you have to do but I personally would never have involved my mother for a few reasons.
1. It is none of her business. It really isn't.
2. You are her daughter and naturally she will take your side.
3. This reaction is what I would have expected so I would never have asked her to write a letter in the first place.
 4. How does the court know your mother isn't over exaggerating since you are going through a divorce. She is obviously only going to bring up HIS faults. (and apparently the court sees that too)
5. It is YOUR battle not hers.

I am not saying he is right and you are wrong but rather it takes two to tango. Rarely, is one spouse perfect while the other is a holy terror. I am sure there are exceptions but in most marriages both have made contributions that are less than attractive to the other.
I kind of feel like you opened your own can of worms and regret it. That is respectable. On the other hand, I can feel some level of sympathy for your future ex because you and him should be working out the details of the children. Involving parents (which happened) has created a living hell for everyone.

You can't take it back but I would really approach him and telll him you want to talk and work through this with him and him only. It is going to be very important for the children that they see you can get along together. It will be very unhealthy for them to see the familys fighting and screaming and yelling and saying hateful remarks about each others families. TRY TRY TRY to consider how this will affect your children.