I have been very happily married for 14 yrs or so to a wonderful woman! However, she has suffered from depression and hospitalized for mental problems for the past 4 yrs. I have grown distant and seem to have lost our connection and am considering a divorce. She insists I am going through a Midlife Crisis... I have looked it up and so see similarities-
Q- how do I tell the difference in wanting a divorce Vs. midlife crisis??
If it is the later- how can I pull myself out in time to save our marriage (we have two children)

At first glance I perhaps see that you are probably not accounting for how much of a load it is to have a spouse who is ill. Its easy to think its one or both of you when its really the depression causing so much distant. I know depression firsthand and it can be tough. And on some level, it doesn't matter what the illness is, it matters the direction its going and the resources you have to accommodate that direction. You might want to evaluate it in that sense.

Another thing I can think of that I don't necessarily see in the information you provided is time for yourself. My spouse and I have a joint vacation but then we also have separate vacations too. Maybe you ought to consider that for just you. Take a short trip. Get out of town, get a different perspective.

These are not easy or lightweight concerns you have raised here and to be fair to them, I believe they require indepth exploration like the kind found in the running dialogue you would have with a face-to-face counselor over time. Why not seek someone out and allow yourself a more detailed examination. I have been to a counselor quite a few times and can offer suggestions and guidleines, if you are interested in that course. They are not just for the mentally ill. Mine is more like an advisor to me now that I have healed from the other stuff.

A small word about midlife crisis-- I don't think you solve them. I think you choose how to respond to them. I could easily be seen as currently having one. Shoot, I shocked everyone (except my spouse) quitting my job of 12 years but it really was a matter of being driving out over an ethics crisis and my unwillingness to compromise. But it is a time to feel a bit lost and reconcile how little time is left and begin making critical decisions that reflect that understanding too.

I hope this helps if only a little but again, I think it will take more than what can be offered here.