The kids' happiness is less important than their physical safety. This mom is taking her kid's medication, and is intoxicated on various things while supervising them and driving them around? That is what I'd focus on, not how little they're getting for Christmas.
I'm a mandated reporter. I don't know about the military career aspect, but DCF/social services doesn't remove kids from a home unless it is pretty blatantly bad. I know there are horror stories but in general there are several stops along the way where the parent/s get chances to straighten up their act.
Tough situation... but if you feel the kids aren't in a safe environment, I think you have a moral obligation to act for them. They're helpless and innocent.