If you can get those witnesses to write an affidavit and get it notarized now it would be a great thing to save in your files. It's best to not wait until they've forgotten the details of the situation. I'm not sure if "they're all family" means they're his family and you don't think they would speak badly about him, or if it means they're your family and you don't think the Court would believe the affidavit (the Court will consider the evidence. Sure, the Court might assume the potential for bias, but if a clear and consistent picture is painted by the affidavits it's good to submit anyway).
Put something in the parenting agreement. Hope that if, god forbid, something happens to you, he'll assume that he has to follow the parenting agreement. It's not enforceable, i.e. if he would have some awakening and decide he wants to be a full-time dad, the Court will not enforce the parenting agreement and automatically send the children to live with the person you've agreed upon. The reason is that you can't know now what will be in the children's best interest several years from now. OK, I agree if you believe him to be a terrible dad right now, that it is reasonable to assume that he'll still be a terrible dad in several years, but it's not always the case. For example, maybe the agreed-upon guardian decides to take up a new, dangerous, lifestyle that makes them unfit to parent. I don't doubt your choices, but it's just to say that circumstances change in ways we can't necessarily predict. It's the same for people who try to use a premarital agreement ("prenup") to decide the fate of their hypothetical children in the event of a hypothetical divorce--the Court won't enforce the agreement on real children subject to a real divorce. But this doesn't necessarily mean he won't just assume he has to follow it because it's in the agreement so I think it's worth a try. If he's not really interested in being a full-time dad anyway, I think giving him a comfortable "out" is a good idea, regardless.
And then, keep their godparents (B+SIL), or whomever else you choose as a guardian, incredibly involved in your children's lives. Uprooting children from their lives (school, friends, activities/extracurriculars, church, family, ...) isn't desirable (to you, to the children, or to the Court) so having them established with your desired guardian is good argument to have on their side. It wouldn't necessarily override going to live with their dad by itself, but it could tip the scales if his ability to parent is otherwise questioned.
I agree that you should verbally confirm with them they are willing to fight for custody. It might also be a good idea to work with a lawyer to set up a trust so that you can prescribe how the money will be spent, particularly if you think they might eventually see the dollars and decide to spend it on something other than getting custody of the children. I would also cover your bases and elect an alternative guardian in the event something happens to B+SIL. Have you considered what you want to happen in the event they separate? Would it change your wishes? If so, that needs to be documented as well so the money goes where it should. Don't leave the money directly to the children without a trust, or they won't be able to access the money until 18-21 years of age (depending on the laws in your state).