Absolutely, I would however disagree with the "list" ENCRYPTEDTX yes there are generalities that need to be worked out, whats in, whats out.. but worrying about being bigger, smaller, better or worse..
Bottom line, and the only red flag I see, is the meeting between the ex, and your wife.. even if its supposed to be non sexual. Be there, for support, and to make sure this is a person YOU want to invite into your bedroom or share your loved one with.
I do not care if its 15, 20, or 50 years later, there is an unspoken question in your wifes mind.. If as you say they never actually did anything beyond heavy petting, the question of what He is like in bed has swirled her brain at least once or twice.. The trip and nerves .. it happens..
There is an unspoken component that hasnt been addressed by the rest of the posters.
In a perfect world and I might wonder if its not lurking in the back of your brain.. The concept of fair is fair, or whats good for the goose..
Her frank statement about jealousy needs to be worked out. Sure, granting her fantasy, might lead to a relaxation of her attitude concerning this, but, it might not. It does suggest a small insecurity concerning the relationship you have, perhaps because of a previous expereince, I dunno, its an unspoken thing, but it needs to be discussed and she needs to be re assured of your feelings for her. Once of the things I always tell newbies is, be sure to explain regardless of what happens during the evening, at the end of the night, you are still going home together.. your relationship is first and foremost, enjoy sex, is like enjoying a great game of ______ (insert whatever team sport here) its done for mutual enjoyment and pleasure.
I may be way off base, and concerned over something that doesnt need to be, but, I believe as was pointed out, cover all the bases.