Yes, and I would certainly sit down and talk with CPS if I were you, that way you can tell your side of the story. If you don't, CPS won't have all the information and they have to come to some conclusion without hearing you and the husband!
Disclaimer: This answer is intended for educational or informational purposes only and should not be considered legal advice nor forming the attorney client relationship. This lawyer is licensed in TX and you should consult an attorney in your state before moving forward.
Yes they can. The theory is that the kids will speak openly without fear of intimidation. Of course the whole process depends on the initial reports being accurate and truthful.