Hanging, I'm sorry this is happening to you.
A couple of suggestions for you -
1) You said, " The two weeks of Jan 8 - Jan 19, I averaged 28 hrs per week. Since then I've been able to work average 35 hrs per week. I'm getting my job done, meeting all my deadlines, being paid hourly for the time at work, and I'm accurate. But that's not good enough, because I'm not sitting in my chair 40 hrs a week. Personally I think replacing me is stupid. They're having the work done, and they're paying less for it. I know everything, and now they'll have to train someone and gamble on their experience level. I just don't understand why you replace someone with all the knowledge and experience in YOUR company, instead of working with them."
Put this in writing to them. Also put in writing anything your boss said to you in the meeting where you're sure you can quote him. Ask him to verify that this is what he said. Include the phrase, "If I do not hear from you to the contrary, I will assume my recollection of your words to be true and correct."
2) Ask for notice of dismissal (or notice that you should "look around, for maybe a Government posting") in writing. Until it's in writing, with reasons, do not accept it as final. Be stubborn but dumb. "How can I be sure I have a good understanding of what you mean, if it's not in writing?"
Whether you ever take things any further (even if you can) is still up to you. But it also means that if a future prospective employer asks why you left the previous job, you have the letters to point to. Not doing this - you could be in a situation like husband was some years ago. He was "let go" from a job, verbally told "you know the reasons why" when he didn't, then could not get another job in the same industry. he changed careers for a lower-paid but more secure option, then about a year later, the job offers from his old industry started flooding in - they were headhunting him. Whoever had blackened his name surreptitiously had finally been shown up - too late for husband, assuming he could ever trust that industry again.
husband could have sued, but instead chose to walk away with dignity. It hurt too much to keep fighting when you didn't even know you had enemies, let alone who it was. Frankly, I wish he'd sued. The company was definitely worse off without him - his replacement didn't even last as long as he did, and did far less. But at least he stopped working ridiculous hours and trying to please the unpleasable. I also wonder if it was my continuing disability that was also a factor for them - I have had people in the workplace treat me very strangely because of their weird perceptions of my health problems.
SO - cover your rear end, even if you don't think you need to. Loyalty stops when you walk out the door for the last time. They will owe you none after that point. Get all references and letters of commendation before you go. Get everything else you need in writing before you go. Trust me on this - it's a lot harder to go back afterwards and hope they remember you well enough.
And here's hoping that asking for things in writing is enough to make your boss change his mind. If he doesn't, he's out of it (his mind, I mean).
A Warrior Mum is a fabulous asset for any company to have. if you know how to fight for your child, you will also fight for your job and the people who employ you. Tell them this, also. In fighting for your child you have skills they can benefit from.
Good luck, whatever happens.