Merc, I sympathize, it's a tough call.
The positives include a change of both workplace and residence (you're practically rusted on where you are), less risk of unemployment for at least the next year or two, the lifestyle change that enforced days off are likely to bring, and the security of medical benefits.
The negatives include a change of both workplace and residence, the inescapable feeling that you're letting a bunch of people down, and the loss of autonomy you feel from your consulting.
The real reservation I have is the motivation behind the new offer. A 5-year contract that doesn't pay particularly well sounds more like exploitation than appreciation. More importantly, it sounds like it won't add anything to your C.V., which means that in five years time, you may be unemployable.
I'd take your concerns about your present employer's viability seriously - it's unlikely to be just paranoia - so you probably do need to do something while there are opportunities available. Have you looked for other jobs? I'm sure you're a far more attractive proposition for prospective employers than when you were looking several years ago. In the market here, for instance, you'd probably be able to do contract work as an Exchange guru.