You need some proof that you're no longer married, because the first thing they will do is look in the entry record and see why you were denied previously. So take divorce papers or whatever to show that the relationship is over.
Your children are not as simple as getting TD because they qualify for US citizenship. The better idea is to get their citizenship sorted out and they simply enter as US citizens. If you have joint custody with the father you will need proof he has given his permission for you to move (the fact you're moving closer isn't relevant, it only boils down to the fact that you've moved).
The only slight snag is that if your children are US citizens, CBP may think you don't have non-immigrant intent. However having children who are US citizens in no way confers upon you any advantage in staying longer, so it shouldn't be a problem. Depends how old they are, if they are teenagers they will be approaching the age where they can sponsor your entry.
Obviously being US citizens is a major advantage to them over being on TD for many reasons if they're living in the US. They can work, get in-state tuition rates, get permanent SSNs and so on. The only disadvantage is that the tax situation could get complex, but they will need income first before that becomes a problem.
Your sister can sponsor you on I-130 when she gets citizenship, however it would be fourth preference and those take (roughly) eight years for a visa number to come up and then the best part of another year to adjust status or get a visa, depending on where you are at the time.
Read this:
http://www.consular.canada.usembassy.go ... abroad.asp
Steve.