Hi, I'd like to help you with your problem.
I am sorry to hear about what is going on with your sister and her family. It is difficult to deal with a situation such as abuse and as a family member, it is tough to know what is the right way to handle it.
You mentioned that your husband has talked with your sister's husband about the situation but he is denying anything is going on. And it sounds as if your sister has spoken to you about her version of events as well. But from what you wrote, I am getting the idea that you and your husband are not as willing to believe their denials about the situation, especially after what your niece told you.
You may want to try talking with your sister again. Go somewhere that the both of you will not be disturbed and express your concern and let her know you care. Do this in a neutral way, without accusing or anger. Let her know that you are worried, particularly about her children. See if she is at least willing to talk with you about it. Abusers often rely on secrets and shame to be sure they can continue without interference. Someone needs to step out and tell, like your niece did, especially if their are small children involved.
If you feel there is enough suspicion to contact the authorities, you should do so. Although your sister may be in trouble herself, she has more choices than do the children. Your sister can contact the police or leave the home and go to a shelter if she feels she is in danger. However, if no one is protecting the children, then children's services need to be contacted and a report made. You can call anonymously. I recommend contacting Childline first to make the report. You do not have to give your name just what you suspect is happening and any facts you have. Your niece can assist you with this if she is willing, especially since she knows details and can give a better account.
Try to maintain contact with your nieces and nephews who are still in the home. See if they can come visit, maybe overnight, and let them know you are there for them. Don't bring up the abuse unless you feel it would not cause more harm than good. But make it clear to them you are someone they can turn to if they need it.
Don't give up. Try to be there for them as much as possible. If you can get your niece, the one who left the home already, into counseling all the better. If she has been abused, she will need the guidance and support to work out her feelings and move on in her life. These children are blessed to have caring relatives like yourself and your husband to watch out for them. So many children do not.
I hope this has helped you,