I think Laurie makes a good point, particularly with the "get stable with yourselves" first.
Jim was diagnosed in May/June '08, and for a variety of reasons we didn't not tell our families about it until Sept. One was that we wanted to process it first ourselves, get to a point where we had mapped out a plan, and could discuss this in a calm & confident manner.
We told our "children" first- adult sons, 27 & 30 at the time. It was hard, no doubt about that, and not everything sunk in at first. After some digging & researching by them on the internet, they saw that "2-5 yr. timeline" thing that we didn't mention.
A week later, while talking with younger son, checking how he was doing, did he have any questions, he totally broke down. I let him have his cry, but then gave him the pep talk- we don't know what will happen, everyone is different, we trust & believe God is here to help us, we will take one day at a time.
He then asked me "Mom, are you OK?" (I was very touched by that) to which I calmly said, "yes, I'm OK. We are all going to be OK; we will get through this." We also told them both that if they have any questions for or about Jim, the diagnosed or progression they should come to us (and not the internet, or other people) and we will answer any question openly & honestly.
Now I realize young children are a different scenario, but I do think they will take your lead. If you are calm & matter of fact, they will be too. You can teach them strength
in the challenges you face just by example. This can be the greatest life lesson you could give them!
(my turn to stop preaching!)