May have really screwed up and need advice.

I asked this question in Yahoo answers and was advised to ask here.

My in-laws have been at our house for the past week, and will beb here for another 5 days.
Anyway on Sunday they all went to church, but I stayed home because I had wroked late Saturday,
and "really" just didn't want to go. I wanted to sleep in. About 10 am I heard alot of noise in front of my house. So I got up to see what was going on. I sleep in the nude, but thought there was no one home. So I looked out the window to see it was the neighbors playing around with their new 4 wheeler. I was a little swollen down there, and thought what the heck I'm alone for the next couple hours. So I took out one of my favorite porns and started watching. Well then I started J'ng-off to it.
I was probably there 15 minutes or so, when I heard something shuffling. I looked over to my right, and seen my mother-in-law sitting there watching me jerking off. I went to cover myself, and she was like no no no please don't stop. She told me she enjoyed watching me do that, and ever since her husbands heart problems he stopped doing that. I didn't know what to do. She was like, its ok, theres no need for you to be embarrassed or ashamed and that she wouldn't tell anyone and asked for me to continue, but asked that she could watch me finish. I know it may sound gross, but it was a turn on for me. I've never done anything like that before. Especially infront of a woman her age. She sat in the chair next to the sofa where I was sitting and watch me doing it until I finished. I don't think I had ever exploded like that before. When I had gotten up, she asked if she could hold it, which I allowed her to do. Thats when she put it in her mouth. It wasn't there long, but to long I know. I guess I was caught up in the moment, or at least thats what I'm telling myself. Later she asked if I could do that for her some other time. I told her I didn't know.
It's not like we're young and don't know any better. I'm 34 and she's 58, and her daughter (my wife) and I have been together since we were both 13, and have been married since we were 18, and we have three children. I just think I really screwed my life up, and don't know which directing I should take now. I fear my wife will find out some, especially if I don't do this for the mother-in-law.