Thanks for the responses so far. I should give some of the nuance about my Dad's situation. He 66, still works full time, and has a part time job (which he plans to work into retirement). Unfortunately, he is not financially ready to retire just yet. I don't know much about his retirement savings. Insurance, Medicare and SS handle most of my mom's bills, my dad is taking SS, which is not the wisest I know. He is not put out by us living there to a large degree, other than delaying him selling the house, which he does not have a lot of equity in. (at least I come by my poor financial history honestly).
We have considered the idea of buying the house, or at least paying him market rent, but it seems best to part ways as soon as is reasonable. The $400 is to ease this idea that we are starting to mooch. I choose not to pursue a national search for a job when I lost one, and chose to move closer to family, something that can't be objectively quantified. Living with Dad gave me a chance to restart career wise, and now my kids are totally comfortable going to see my mom, which is priceless. Living with him is really not that bad for any parties, from an interpersonal standpoint. Financially, I'm getting both messages from the responses so far. Stay as long as you can, leave as soon as possible. Again, our plan is leave in 15 months. Maybe that's a fair compromise?
Nobody needs to remind me that I'm a grown man, I remember that every day. I landed the best paying job I've ever had. We have been earnestly applying these principals to our life. We just discovered MMM, but have been following a Dave Ramsey cash budget, debt snowball, etc. and my wife and I are working through lots of history and issues around money, and we are on a good trajectory towards being more stringent.
Oh yeah, I am claiming 6 allowances on my W-2, should I do more? Also wife is not going to work full time for a couple more years til 2.5 y/o is in school. She does work very minimally part time and is open to other ideas.