I wish I had some good advice for you. I don't.
One thing I learned along the way through R is that I cannot, and must not, take accountability for other people's choices and actions. Some might refer to that as "emotional blackmail". A good example of this that we see sometimes on SI is when a WS tells a BS that if they leave, the WS will kill themselves. Then the BS is stuck with the notion that they are somehow responsible for what their WS does if they leave. But that's not true, and it's not fair.
If what you say about your BIL is accurate and true, then he is already a threat and a danger to his wife and kids. Yeah, opening this can of worms could set off a shit-storm, and I can see how you might have reservations about that. No one wants to think that maybe their actions caused someone else to do something horrible, or get innocent people hurt. But again, we cannot control others. Your sister is currently making the decision to stay with him, but she's doing so without all the facts. Let me ask you this... suppose that your BIL's infidelity (the trip with the prostitute) suddenly comes to light, and he mentions to your sister that you were involved and knew all along, and chose not to tell her. How do you think she would feel about that? How would she view your reluctance to say anything to her? Would she see it as love for her, or CYA for yourself? Now, compare that with saying, "Sis, I know this is gonna hurt, but I love you enough to risk your anger so that you can have the truth...". One outcome just reinforces that you are an untrustworthy liar. The other option makes you someone who did their best to do the right thing, even when it meant throwing themselves under the bus. Who do you want to be?
There is a time when the truth needs to come to light. You've been lying to everyone for a long time, and this is just one more. Ask yourself this... what are you most afraid of? What your BIL or sister might do? Or how you will feel about what they do?
FWIW, this might be something of a blessing if things go wrong. When you say they are planning to "move 20 miles away", do you mean 20 miles away from where they live now? Or 20 miles away from you? I am assuming the latter. If so, then if things go wrong, it will be MUCH easier for your sister to come to your place for safety, or for you to go to her if she needs you. Just a thought.
I'd like to see what others have to say. There is no "right answer" to this one. IMO, by coming out and telling your sister the truth, you are opening the door to healing your relationship with your sister. And by proxy, perhaps your own marriage as well. Remember, what your wife wants to see is you "owning" your decisions. They don't have to be decisions about HER. She just needs to see some integrity from you, and a willingness to take the heat. It's not about punishment, it's just accountability.