Hi, yes, never release aquarium animals into the wild as they can transfer disease and illnesses which the wild ones might not have.
It is very possible the babies will not survive. They need marine water for their larval stages.
I haven't read through all of this post but it looked pretty thorough.
New to FW fish? First tank in a long time or EVER??? Need some info on keeping fish?
Start here - Aquarium Advice Article
FW Favorites right now Clown Loaches, any shrimp - SW Vase Red Mangroves