I think you need to look at this in the bigger picture. First, though, congratulations -- you are in a fantastic position, and so what you do with $300K won't make or break your plans. So don't drive yourself nuts trying to optimize.
I think the bigger picture is what do you want your overall asset allocation to be, and where does this cash fit in there? Part of transitioning to retirement is the shift from maximizing your upside to minimizing your downside. For me, that means 3-5 years of expenses in a CD or bond ladder, which then allows me to keep the rest of the money in VTSAX. Every year, I can live on the money from the CDs/bonds that mature, and then transfer the equivalent from VTSAX to a new CD/bond coming due in 3-5 years to keep the ladder rolling. That way I always have cash available to meet my needs, plus the flexibility of waiting a year or two to sell out of VTSAX to replenish my cash stash if the market craters.
Other people do it differently, of course; some folks will have a set asset allocation and then sell out of stocks/bonds proportionately every year to cover expenses and re-set the investments to the target allocation. The point is that there's nothing whatsoever wrong with keeping $300K in cash if that's part of your strategy -- for you, that's about 3 years expenses (more as long as your DW continues to work), so that's really the equivalent of my CD ladder. So it's perfectly fine not just to keep that money there, but to replenish it every year as you spend it. Or if that's not your particular plan, then invest it right away so you keep your overall asset allocation within its target range.
I do agree, however, that it would be smart for your DW to max her 401(k) options (and presumably a spousal IRA for you). If everything goes to plan, you two have another 30-40 years in front of you, so the tax-deferred growth will be meaningful. Note also that at your current income level, you could likely do a Roth with minimal tax consequences, which could start the 5-year Roth ladder for you and provide additional tax flexibility in future years.
