Did you and your wife apply for Indo passports? If you did then you just use your Indonesian passport and no need to use the UK ones.
If you haven't apply for Indo passport they will have to enter the country using their British passport and yes they will need visa.
If this is the case I would suggest you check it out with the Indonesian Embassy in Brunei to see if you could apply for the children's passports there. Theoretically you should be able to.