Overall, if being LC is safe and doable, it is probably wiser and better for you and your children in the long run than NC.
Your children are bound to ask about their grandparents and it is much less traumatic for them to be exposed to them in a safe manner (when your husband is present and when you can leave any time it is necessary), and to know them, than to wonder and fantasize who they are and what horrible things they must have done, and if they themselves (=your children) are also somehow tainted also etc. etc.
When they are older, you will be able to explain to them that their grandparents aren't healthy, but they will see that you still love their grandparents and honor them as much as is safe and possible - which is a good and healthy example for them (rather than worrying and wondering if somehow you are the ones who were at fault and "poor grandparents didn't get a chance" - which is exactly what they would be likely to hear, if they contacted their grandparents when they grew up).
At some point will he not have to spell it out? someday they will ask "why can we not visit you?"
he says he will just ignore the question and continue on.
It looks like right now your husband isn't sure how to effectively spell it out, and wouldn't be comfortable doing so... .
In situations like these it is important to have the inner confidence to uphold your boundaries, and not get drawn into an argument of why or why not, and being baited into defending oneself.
It's possible that with time you two will be able to brainstorm and come up with a neutral phrase that you both feel comfortable with - what do you think?