Wow, didn't quite expect the myriad of replies I've found here, but thanks to all for putting in your two cents!
Firstly I would just like to say to RRH that simply leaving a child behind that you've raised from birth, that has your blood, sweat and tears stamped all over her and has NEVER tasted life in the presence of drugged-up, violent parents is downright nasty. From a cold, logical and practical point of view, sure, this would probably the easiest way out. Unfortunately it is hardly as cut and dry as that in real life and to ask parents of ANY kind to simply throw a child to the wolves like that when all she's had is the best in terms of love and emotional nourishment, with NO contact whatsoever with the snake that fathered her is a recipe for disaster. Imagine everyone just gave up on a kid and ran away like that? It's a surefire way to ensure the further growth of an already sick society, and I'm sorry but she might not be my biological daughter but I love her with all my heart and there is simply no way that I will EVER allow her to be taken by those idiots. They'd be taken out before that happens, and NOT to dinner.
Every fibre in my being would LOVE to take this ou out for good, but then I have to ask: what kind of life would would I exchange my own for by taking the law into my own hands? I've already stood in front of a judge because I scarred his face, and right now I've got more important things to think about, like a baby coming and looking after our foster kid. If push comes to shove we will simply have to disappear, and at that moment I will make sure the ********* is disabled enough NOT to have a clue should he decide to open his gob about it. Believe me, I BURN on a daily basis with righteous anger at this pig, but unfortunately we don't live in the dark ages anymore, and to take out this little girl's biological father only to leave her with no father at all kind of defeats the purpose, to not even begin talking about leaving my own kid behind. Ain't gonna happen.
Selling the house has come up as an option. We would love to buy the house from my mom-in-law and then get his ass evicted (or forcibly removed if I had any say about it), but the financial means to do so is simply not there at the moment.
Either way I guess we'll just have to see how things pan out. I will however say that I do not think for one minute that welfare will go as far as forcing a child who's had the good life her whole existence into a garage with a bunch of addicts. The Children's Act is there to have a child's best interests at heart, and forcing it into a situation that can hardly be best for her is nothing short of inhumane. I have to believe that the people handling these cases have some sort of grey matter between their ears, but that being said we do live in good old SA, so I suppose time will tell what's what. If it looks like some idiot at welfare gets it into his or her peanut brain to force our kid to go and live with her bio parents you will see us disappear quicker than a ninja in the night. My wife and I simply won't allow such a situation to come to pass, and if idiot boy EVER shows up at my new place he will get a face full of buckshot, no questions asked.
Everything said and done I will be looking into the various options presented by everyone here and see if there's a way to walk which will have the least amount of casualties as an end result. Thanks for all the feedback once again and God bless.