St. Rita had the same problem with her husband corrupting the children, as did St. Monica to an extent (although St. Augustine was often his own worst enemy).
Separation is permitted in the case of adultery, and his constant unrepentant use or pornography IMO could possibly rise to that level. And if you believe that the children's souls might be in mortal danger, that might constitute grounds for separation. Who knows, perhaps the threat of separation might cause this clown to rethink things.
Unfortunately, you chose your spouse quite poorly. Whether or not you were Novus Ordo before, his lack of character was most likely already manifest even before you became a Traditional Catholic. Perhaps you could win him over by showing him lots of affection. Sometimes even the hardest of male hearts can be moved by a woman's love and affection. People can be turned off by Traditional Catholicism if it comes with a spirit of bitter zeal and Jansenistic attitudes, so it might be prudent to "pick your battles" and show him some affection (if you still have it in you, i.e. if you still have any feelings left for him at all).
At the end of the day, however, these are my own opinions only ... based on very limited information. I believe that you should continue to obey your priests in the matter. God will not punish you for following their advice. Perhaps it's simply His will that your children be subjected to this man's influence, for whatever reason, for their ULTIMATE good, and the torment he causes you can also be an instrument for your sanctification. Sometimes God allows people to stray and to fall so that in the END they might find their way, often having learned great lessons from their falls. Until a person has died in a state of mortal sin, we never give up.