I'm sorry, that sounds really unpleasant. It's too bad that your family is still so indoctrinated. I am not sure what other choice you have. You are willing to live and let live, but they are not. You are protecting yourself and your kids - it's the right choice. You recognize their pattern of behavior and are making safe, sane choices based on that.

Edit to add: I have not 100% cut off my parents, but I have extremely limited i.e. once or twice a year contact with my father and I try to limit contact with my mother. The guilt twinges are far, far easier to deal with than my parents... and I suspect that my father has 0 guilt about his own actions towards me, for what it's worth.