The practical situation is different to that of the legal formalities.
The biological mother, though not alive now, is the your first wife to your children hence only her name can be mentioned agaisnt the column 'mother' of the children in all the forms.
Your second wife is the step mother of your children and not biological mother , hence it would be incorrect to have your second wife's name as their mother.
You cannot change the name of their mother at your fancies and whims
As a matter of act yor second wife has not even adopte the children legally hence she cannot be considered as their mother for all legal purposes.
Do not be misguided by sentimental values and mess up things and complicate the issues which may become a legal hassle in future for the children.