If your DH won't put his foot down and make it clear that either you sit with him at the "main" table, or he sits with you in the "annex," then you shouldn't go. Why put yourself through that kind of misery?

I wouldn't attend the party under these circumstances, and I would want my partner to stand up for me and say it's not acceptable. 

Your husband's place is by your side. If she doesn't want you and your boys who  she's known for 17 years sitting with her mum's side that's absolutely fine. But her dad is NOT to play Happy First Family by sitting with BM and leaving you to fend for yourself. Your partner is trying his best not to rock the boat by quietly planning to move seats on the day but that's not good enough. How he treats this will set the precedence for every event in the future. Weddings, births, etc. His place is by your side. 

 Sorry this is unacceptable. You should be seated with your husband.

Well, where are the partners of all the other adults at the table your DH will be sitting at? If they are all sidelined too, then it's a weird arrangement but okay. If their SOs get to sit at that table with them, then you do, too. 

This is not just a weird seating arrangement. It is a weird seating arrangement designed to ignore her father's wife. Even my SD (who 20 years later would still like me to disappear) knew better than this. Brides here have parent tables when the parents are divorced. Partners get seated together. Wives get seated with husbands. Husbands get seated with wives. Husband/Father needs to tell her that he is sitting with you whether he is in the annex or she moves the table. 

I think that seating plan is absolutely outrageous. Is she determined to have a bad atmosphere at her engagement party? Because I can pretty well guarantee that if she seats her parents together that the temperature will be a good 5° lower at that table than anywhere else in the room.

Why does your partner feel compromised? The situation is ridiculous and he should tell her so i.e. if she wants him there then she needs to have the common decency to seat him with his current partner, you, not with the woman he divorced 20 years ago. End of story.

An engagement party with no respect for marriage, how ironic!

Spouses should insist on sitting together. 

All weddings as we're asian, you have say 3-4 tables for our side of the family and we sit with our spouses. I don't see my husband sitting at main table with exwife and her current husband. I don't want to attend any of my skids weddings because of the arseholes each one of them are and the psycho bitch that is their mum, their stepdad isn't any better. 
 

i know sd here would sear stepdad at main table because her bio mum had brainwashed her that stepdad is daddy despite him and bio mum kicking her out of home when she was just starting university and kicking out her younger sister for eldest sd to care (this was when they were pas'd out) and ended contact with their dad. 
 

if sd here still has resentment of daddy marrying another woman (aka the whore) and the step or half siblings she never asked for (note sd also never asked to be born also), you can be damn sure she is still holding onto that animosity even after she has married

He needs to plainly let his daughter know that he expects to be seated with you.. and if he arrives and it is set up in any other way than this.. he will be rearranging placecards himself.  So, she better get to fixing this.  Your kids can sit with the adult cousins... and you can take a place at the main table.. or she can have two "main tables".. perhaps with her fiance's family split with some with her dad and some with mom.

Personally I would express surprise to your husband at this arrangement and ask him what he thinks of it and what he is going to do about it, but I would not be the person making demands. That just puts you in the firing line. Let your husband be the person driving changes to the seating plan or let him extract himself from the top table on the day. You do what you want to do and sit where you will be most comfortable wherever that will be. Your husband can either tell his daughter what he wants to do or he will have to deal with sitting with people he doesn't get along with. His choice. I bet if he opts not to sit with you that he will regret it and either not attend the next event or insist on sitting with you. 

Remember this is an engagement party not a wedding. As far as I know there are not strict ettiquette rules for where everyone sits, so just do what feels best for you. 

 'it's really hard organising the seating'

I'd suggest she got a bigger venue if she's doesn't have room for everyone in the main room.

There is no way I'd go knowing that I was being sent to sit in an annex at the "kids" table.  That is unbelievably rude of your SD.

If it was me, either my DH sorted this out or I would not to attend.  I don't care about sitting with my partner at a meal/event. I see him every day, its nice to speak to new people and Its generally seen as ok etiquette unless you are newly weds.  But being stuck in the cheap seats is not acceptable.  It is literally saying with the seating plan that you are the least important guest.

Not only is she shafting you as Dad's wife, by shoving you in the annex while seating him by her mother... she's also twisting the knife by seating you and your boys at a table alone.
At assigned seat gatherings, you put guests with other guests they can make conversation with - you don't seat family groups in isolation. She knows this. She's sending the message that both you and your boys are unwelcome outsiders, not even worth the company of other guests.

Your husband and you sit together, and do not "change at the party'.

It is a respect thing. SD is disrespecting her father by doing this.

Your SO is showing how you are to be treated, and this has likely been going on a loooooooong time.

Your Sd is a jerk. Ill just put that out there...

This is an opportunity to take a stand that will impact how you are treated at future social events, including the wedding. Please don't let this slide. Tell your H that this seating arrangement is insulting one more than one level, and you're not okay with it. Either you and your bios are treated like family, or don't go.

And OP, who is paying for the wedding? If you and your H are expected to contribute, that's yet another slap in the face.