OP, your theory is interesting but I don't think that's how it was thought out. But in a way, he sort of did kill them. At least he blames himself.
Exactly.
"After she tried to kill herself the first time, Dolores told me she... she had an insect living inside her brain. She could feel it clicking across her skull, just... pulling the wires, just for fun. She told me that. She told me that but I didn't listen. I loved her so much."
"Cause I can't take knowing that Dolores killed our children... That I... I killed them because I didn't get her help.. you know... I killed them"
I wish I could find a clip of that scene, one of my favourite in movie history.
I remember that scene exactly. But, we're forgetting we're dealing with someone who is delusional. Who says he doesn't have layers to his delusions?
That wouldn't make him a monster, one time popping his wife had she in fact brutally killed their three kids. Being a dumb husband also wouldn't make him a monster. Sure, he'd be miserable living with that truth, but that wouldn't amount to that level of contempt for himself.
Now if he went batshit and drowned his three kids, and when wife tried to stop him, he popped her, later blaming her for the act, yep, he'd be an absolute monster and I'd probably regress into some fantasy to hide from it. Then after one layer is peeled, he remembers another layer to it and intentionally pretends to go crazy again so they split his brain.
How would authorities exonerate him in death of three kids, btw? We know he killed a wife, so no further witnesses. She looks to have drowned them just before he came home, cause she was still wet, so autopsy and time of death wouldn't eliminate him as the suspect.
His wife may have been crazy, but he was seeing things from concentration camps in his mind pretty regularly. This is absolutely plausible, just not elaborated in the movie.
Chris Watts, the family killer, made up this very story to cover for his pathetic ass. Told detectives that his wife choked their two kids, then he chocked her. In reality the pitiful fucked choked all three and disposes of the bodies.