Bluf, I feel for you. I had a similar issue with my ex-wife. She was messing about with one of my best friends for a while. Both insist they never slept together but I don't believe them, and still don't. I didn't forgive her as such but being the sort of bloke that I am - non-violent, calm, reasonably intelligent - I decided to cut him out of my life and try to salvage my marriage, especially as we had a son with a baby on the way. As he was very popular with my group of friends and I was always sort of on the outside as I had a wife and kid it virtually killed off my social life as he was always there.
From then on though I had real problems trusting her. She was very secretive with phone calls and texts, was often not where she said she would be and it all came to a head a couple of months down the line from the original incident(s). Her step-dad took me to the pub and told me I was better off without her because he knows she's cheating on me and I should just concentrate on being a good dad to my kid. It turns out she had been seeing her brothers friend all along in addition to seeing my friend. It left me wondering how long it had been going on? how many blokes had there been? were my kids actually mine?
I'm now of the opinion that if anyone ever cheated on me there would be no second chance. I guess it comes down to what you want. Just because you have a kid is no reason to stay with her. You should only do that if you think you really do have a long term future together. If you learn to trust her again and accept that it was a one off mistake then maybe you can move on, for me though I was paranoid the whole time (or in this case, right on the money) and I felt a hell of a lot better when it was all over. I have a great relationship with my kids now and she has got a bloke who she has kids with so they have a settled family. If she had still been with me I reckon we would have seriously damaged the kids because I would have been questioning her and doubting her for years.
Still, only you can decide and it will take you time to think it through. But don't let her return to normality too soon, if it seems like it's done and dusted so soon then she may think she can get away with it again because you'll just forgive her. Make sure she realises just how much she has hurt you.