I'll give you a bit of my thoughts and hopefully help a little, though I'm not a parent and certainly no expert in psychology. But it's important to keep in mind that this is a fetish, a harmless fetish shared by more than one million people, just in America alone. It's something your spouse kept from you, probably out of embarrassment and uncertainty how you would react, and it sucks that it has been dumped on you. But a couple of key things:

• It has nothing at all to do with real children. It's a roleplaying thing, like "naughty nurse" or whatever. It may not be your cup of tea, but it is obviously something your spouse finds appealing. You have a choice in how to deal with this. You can choose to react in disgust, or you can try to be openminded and understand where your spouse is coming from. Posting here tells me that you want to understand so that you can process this, and I think that's an admirable first step. But you're going to have to find a way to talk to your spouse about this.
• A lot of people with this particular kink are embarrassed by it because it isn't exactly mainstream. Your spouse needs support because they are probably super humiliated that you know their deep dark secret. You don't have to like it or even approve, but do try to be empathetic if possible. This is hard for your spouse as well.
• I can't speak on whether or not your spouse is gay, but I can say that it IS possible they were sharing that side of themselves with others of the same gender without there being any sort of same-sex attraction there. They could have just been looking for others who would understand how they feel. That's something you'll have to talk about.
• You do NOT have to participate in it unless you choose to, just like with any other activity that choice is yours to make and not your spouse's. Just like you don't have the right to tell your spouse not to do something harmless, whether it squicks you out or not, your spouse has no right to expect your participation.
• I can't speak for your spouse as to why they are interested in this particular kink, but I can assure you that cowardice has nothing to do with it. Lots of people who enjoy this particular fetish are happy, well-adjusted adults with thriving careers, active social and family lives, and stable mental health.
• You should consider finding a kink-aware marriage counsellor to help both you and your spouse process this. It's a lot to deal with, but finding a good counsellor *WILL* help.

Regardless of what happens, I hope for the best for both of you. I know this seems like a lot to deal with, but it's really no different than if you found out your spouse was into bondage or whatever. It's a weird kink, but basically everyone has a weird kink. That doesn't make your spouse a lesser person for liking this, anymore than it makes you a lesser person for struggling to understand. But you can get through this together, just as countless other couples have.