Can you move DS1 to a floor bed on Daddy's side of the bed? He can start the night there, if he wakes up, he could come into your bed for a cuddle and then you could either let him stay or move him back to the floor bed. (You and DH need to be on the same page about what the plan is re: wake ups.)
Then you and DS2 can move back into the same bed as DH, put the cosleeper next to your side of the bed and put DS2 there when he is very deeply sleeping, and just try to be as consistent as possible.
I think this will be fairly easy, just address one thing at a time, maybe start over the holidays?