Is it ok to have a friend sleep over in the same bed?

Me and my kids mother live together because it works out better finacually and for the kids but we are not together.We have seperate rooms and keep are personal business outside of the house...In the past I have had to take custody of my kids because she allowed people to live and sleep in my kids rooms..she had guys and girls sleeping in her bed...and her life was going down hill,she got kicked out of school ,car reposest ,lights cut off,quit her job and decided to live off of my daughters disability check and didnt tell me she was getting one ,thats besides the point.When we moved in together because we thought id would be best for the kids money wise and the could attend the same school,plus she had no car so there would be no way for her to see them.We both agreed that all this would stop....no people stayin over night and company to a minimum...she started having her friend and her babycome over till 3,4 in the morning .they would allways be in her room..playin music talkin,smokin whatever...so im like cool ya know every once in a while its ok and there outta my way but it bothered me because I knew she had been with women in the past or shall I say she never denied anything when I would mention the rumors I heard...so I get up one morning and friends baby is there playin with my kids and im thinkin why is she still here and where did she sleep...she explained that she didnt have anywhere else to go so im like ok but i dont think its a good idea...I was tryin to be nice about it..I told her it botherd me because I know youve been with girls before ...so a couple weeks pass and I get up inb the morning and there layin in bed together...so I snap...and tell her she gotta go ..and we had allready discussed this issue atleast 4 times before so to me it was like a slap in tthe face..I told her there's nothin wrong with helpin somebody but company sleeps on the couch not in the same bed ...you or her should be on the couch...AM I WRONG ? she tries to act like its ok and im over reacting...I said now if you heard I was gay and you woke up and saw a dude in my bed even though we werent doin anything what would you think and how would you feel ...how would the kids feel to see that....