I’m sorry you are here.
From my perspective Two truths exist:
1) she cheated. She cheated emotionally and sexually (physically). Whether there was intercourse or not, pulling her pants down, exposing her privates and letting him do his thing is cheating. It’s enough of a betrayal to warrant divorce. Like you I do t believe that was all they did. But it’s more than enough. And all things physical that led to that moment, hugging, kissing, caressing all add to the intimacy of this affair. I would make that clear to her.
2) she’s a liar. She tried to hide the relationship. She lied to you several times and reversal of admission is basically the same as lying by omission. I would let her know that all trust is broken because of this and it will take years and perhaps even more than a decade to repair what she has done if that’s the path you both choose to follow.
To me I would make it clear that both of the above mean she has broken her vows and seriously damaged if not destroyed the marriage as it was.
You are probably feeling that you don’t want to leave and end the marriage as you have hope it can be salvaged. My opinion, and it’s only mine so use it as it works for you, is that she already ended the marriage thru her choices and actions.
You can’t duct tape it back together and think it will ever be what it was.
Instead to me, the right path, whether it’s eventually going separate ways or building something new starts with the same first step: Separation, legally and Physically; and using the time apart working each on yourselves.
Rebuilding cannot start until she works to fix what was broken in her to begin with. I hope her therapist is an infidelity specialist. If not tell her you have no chance of a future together down the road if she doesn’t find one to work with.
And I recommend you work with a trauma specialist. It will take a long time to work thru this pain. Really no work on the marriage will be fruitful until you do.
You get to decide the terms of the separation. I would let her know that if she decides to spend her time with the AP or any other man that you will start divorce proceedings. If it were me, I might file anyway, but that is for you to decide.
And the last thing I would communicate to her is that rebuilding a relationship after infidelity starts with a long term plan and that if true reconciliation is what she wants, she needs to research what one contains and create the first draft of such a plan.
But she needs to realize it will be one that will have 1 3 5 and 10 year milestones and will never be easy, so if she’s not up for that work she should be honest and not waste either of your time.
Again sorry for your pain and I wish you well.