Speak with an attorney before moving forward.
First, you don't really mention your own immigration history.situation. Even a lapse in immigration status would normally be forgiven if adjusting based on marriage to a citizen, but having entered illegally to begin with wouldn't be.
You are right to be concerned about how USCIS would view the situation given your wife's prior marriage/sponsorship. But, with the proper documentation of the history of your relationship and your current shared life this can be overcome.
Speak with a lawyer about whether you have a viable case and how it can best be presented.
First please ensure you entered with a visa legally if your spouse will sponsor you. Second you will have to show that you and spouse are really married and living together. This should include a lease in both names, a joint bank account, bills in both names like phone and electric bills. Photos of you and she and the child together will
Help as well as insurance such as medical or like insurance. You can get a joint sponsor yes.
Please consult a lawyer as to the specifics of this case. This does not constitute an attorney client relationship,
Through joint documents--lease agreement, joint bank accounts, bills in both names, etc.
You should retain an experienced immigration lawyer to review all the facts and advise you accordingly.
J Charles Ferrari Eng & Nishimura 213.622.2255 The statement above is general in nature, as not all the facts are known. You should retain an attorney to review all the facts specific to your case in order to receive advise specific to your case. The statement above does not create an attorney/client relationship.