I'm frankly surprised that LW's wife allows him to touch her at this point.

Couples' counselling is definitely in order, but LW needs to shut up and listen carefully to what his wife says. Imho it's clear he does not understand just how much damage he inflicted with his comment. LW needs to accept that his wife probably never will fully recover from it and will likely never fully trust him again, even if he is sincere in saying he's willing to put in the work to win her back.