First, I am very sorry for all your family has been dealing with – Alzheimer’s and Dementia are hard enough and then the added grief from losing a loved one combined with tender feelings within the family – you certainly have your hands full.
Now – to address your question, your last sentence about it being “his” obituary is most definitely the right perspective to take. We have a “rule of thumb” when it comes to difficult relationships and funerals, and that is simply “it’s not about you – it is about the deceased.” You will not be able to make everyone happy no matter how you write the obituary, but if you focus on the deceased (and not who you are going to offend), then I think you will have done the right thing and honored him. The details of the ins and outs of their relationship do not need to be mentioned at all in the obituary.
When it comes to listing survivors in the obituaries, stick to just the facts. You typically follow the order of the next of kin. (Spouse, then children, then grandchildren, siblings, etc.) Since his spouse had passed, she would be named as a predecessor in death. Then list his children in order from oldest to youngest as survivors, then step-children, then any siblings.
I hope this was helpful. We certainly extend our condolences for your loss, and wish you the best as you navigate through the uncertainty ahead.