It could very well be that your ex is bipolar too and this can be why she gets manic and then collapses and gets confused.

My advise is to do whatever you can to get the children in your custody where you can provide a more stable environment for them because the behavior patterns your ex is exhibiting will affect your children in ways that can actually contribute to their experiencing life long challenges they really don't deserve to experience. Also, if your wife does suffer from bipolar disorder this is hereditary so you should be paying attention to your children to make sure they don't have this challenge. There may also be some borderline personality in the mix as well. I feel sorry for this new child she is having because she really sounds like a very unstable disordered person. So do your best at working on having your children live with you so they can experience a more stable environment and you can have a way to distance from this woman who has contributed to your own emotional confusion. If you can get her to sign something giving you custody of the children, that IMHO would be better for the children and as I mentioned help you distance from your ex too.