Peggiann,
Your questions really hit home for me. I have felt very guilty for the pain I've caused my wife and have deeply considered why it is that it happened the way it did.
I revealed to my wife, before we were married, that I cross-dressed. We even went out once, on Halloween, with her in a wheelchair and me in an old fasioned nurses uniform and white high heeled pumps. The scary thing was that I was wearing a full beard at the time also

! But at the time that we got married, and until last July, I told myself that that's all I was. A cross dresser. I was happy with myself, having let go of the guilt resulting from my feminine expressions and I can say that I was content with myself and my life.
Until last July. Two years previously we had gone to another Halloween party for which my wife and I switched roles. I was in a skirt and sweater, she wore my youngest son's tuxedo (she looked so cute too! A little like Alfalfa from the "Little Rascals"). In hindsight I've realized that it was during that party that I discovered that I felt so much more comfortable, so much more in tune with how I felt inside when I was dressed that way! The next week, I got my ears pierced and I got contact lenses so my masculine eyeglasses wouldn't detract from my appearance. I also decided not to stop shaving my legs, even for the summer months, which is what I did before so as not to get "caught." The thing was, though, that I did all this in view of making my cross dressing more realistic. I still did not realize that I was actually beginning a transition. I'm sure my wife noticed but said nothing, knowing that I still cross-dressed.
Then last July, about three weeks before my birthday I had what can only be described as a sudden realization, an epiphany, of what I had been slowly leading up to and that what I had done up till then was not going to be enough. This event threw me into a deep depression that has not lifted completely ever since. My wife asked me what was wrong, there was no hiding it, and I dodged the question for three weeks until I finally told her how I was feeling and why.
The point of this story is that some of us, I can't believe I'm the only one, simply do not know this about ourselves at the time when we get married. One of the reasons I started therapy is because I cannot trust myself anymore to be honest about how I'm feeling, I've fooled myself too effectively and for too long.
You ask in the thread's title, "What is the Fair and Loving thing to do?" I think the fair and loving thing to do on my part is to allow my wife, the person I love, to decide for herself if staying with me through this is something that she wants to do or not and, if not, to allow her to go even if it will destroy me in ways that I don't even want to or can imagine. Will I fight for her? Yes, of course! But in the end I must let her go if that's what she needs to be happy. And I think the fair and loving thing for her to do is to make that decision as soon as she can and as firmly as she can so that whatever happens, it is done with due consideration and conviction.
Grief will happen in this. I grieve for my lost self-assurance and contentment, believe it or not. I grieve for the pain that I may cause my family and loved ones. I grieve for the shame that they may feel, even though I am not ultimately responsible for that shame. But, unless a person holds on to their grief and wears it like a martyr's cloak, it will end, it will change, as all things will.
helen