it upsets me too, our new fella finally moved in because, like your visitors, he had been visiting for a long time, asking for food and shelter. I don't understand why families take in furbabies of any kind and treat them as possessions, sometimes worse.
It's a really hard place to be, I have now got an outside cat shelter for any cat who needs it but even they aren't cheap, unless you make your own, which is simple to do if you have the health, strength, resources, time. For me buying was the best way to go, but still the cost was hard to find but I think is worth it if it helps.
I understand your quandary with neutering, because he is a pedigree, and for you, the legal implications. I know that it may cause concern and problems but you may just have to keep reporting them to the RSPCA. Did they not discuss neutering? Do you know what the outcome was from your first report?
I found out when Solitaire was shot the legal slant against cats and their guardians, we were told in the eyes of the law cats are legal property and if harmed the only recourse is a claim for criminal damage, and only for the cost of repair or the original cost of purchase,
(Nothing would be done, I'd have to take the person to small claims but the police wouldn't help in identifying them, they'd have to own up, unless there was shown to be lots and lots of cats shot in the area then the police might get involved!)
if you neutered him you could be charged with criminal damage and possibly loss of income if they could show their intent to breed. Instead of you being shown to of helped the poor Tom! If you and your friend were found to of taken him in you would also be put in a position to be charged with theft.
Saying she used to be a farm cat is not an excuse either.
My heart goes out to you, I understand your concerns, but you can only do so much and mustn't put your family at risk through being too kind, won't stop your worries I know but your babies come first and you can only do so much to help, continue to be a kind and a safe place, do what you can until you have no choice but to intervene with stronger measures.
Do you know if either cat has ever been registered with a vet? If so speak with the vet, they might be able to approach in such a way as to appear as if they're just doing some awareness raising. I had concerns over a tom and asked my vet to check if he was on their books, no data confidentiality breach, just a yes/no, with this tom it was no, he hasn't been registered. If he had I Wouldn't of been given any info, but all I wanted was yes/no answer.
Is he fighting and hurting any of your babies? Just a thought, because if he is you might have a legal way in as recourse in protecting your family. It might or might not work, I don't know, but if legally cats are property and damages can be sort if harmed, makes me wonder how it applies regarding someone else's property (cat) harming yours?