Here is the answer.
Up until 1907 you couldn't marry your deceased wife's sister!
https://en.wikipedia.org/wiki/Deceased_Wife%27s_Sister%27s_Marriage_Act_1907The children from both marriages were baptised at Old Church, St Pancras, but that will be why the marriage didn't take place there (even though they already had a child baptised there prior to the marriage). I've browsed through several months of marriages at the church in case there was a transcription error. They hardly would have the Banns published in their own parish if it's a forbidden marrige and they're known there.
There is some very strong circumstantial evidence that she is the sister without the second marriage record. I think they married in a Registry Office to avoid scrutiny. Also her outfit would have been getting a bit tight...
The father of the two wives died at his son-in-law's house (same address where according to census records the son-in-law lived for decades) in 1863. The will was proved by the oaths of the daughter, a spinster, and his son-in-law in early 1864.
They have the same address (the address where her father died). This daughter has the same name as the woman he married in 1867. Her place of birth (in Sussex) on the 1871 census is near where his first wife was born. His first wife's father had the same name as the man who died in 1863.
So it appears to me that she was looking after her nieces and nephews in London and also caring for her elderly father (as dutiful spinster daughters were expected to do) and they got close.
Just saw your post bearnan. Same scenario.