This is gonna be long but I need advice

I am so bad with saying no and sticking to what I say. My parents are toxic (multiple affairs, letting my kids play with bleach bottles cause “they were empty,” telling me they’re entitled to my kids, calling me a shitty mom, flipping me off in front of my kids, beating up my aunt, feeding my kids food they’re allergic to on multiple occasions, trying to pin my kids against me in order to ensure that they are favored by my kids over me, not to mention they have relationship issues with nearly everyone in their lives... to name a few things out of many). Anyway my dad has been smoking a ton of cigs inside of their house in their master bathroom to the point where I can smell it throughout the house. He says it is to cope with my mom cheating on him over 2 years ago. They also purchased cats, which is bad for us cause my daughters and I get hives from being in houses with cats. They originally said they’d keep them in basement for mice, but ended up allowing them upstairs where we go when we go over. And they weren’t going to tell me this, but my mom slipped and told me and tried to backpedal out of it. My kids get hives and they were just gonna let that happen and not tell me that they allowed the cats in the common area. Anyway they haven’t been allowed to babysit for 2 years now, but I recently (last week) told them we will not be going over their house anymore but that they’re welcome at our house whenever. My dad sends me this today:

What do I say and how should I handle this situation?