For various reasons I have been looking again at 1 Corinthians 7, and thought I would post something here regarding my take on 7:14. So here is a rehash of something I wrote in 2004 for another forum...
I think an understanding of this verse should (at least) address the following issues:
[A] 7:14 begins with GAR ('for'), and so there is a connection with the preceding. How is that the issue of 'holiness'
[B] What relationship (if any) does Paul's use of 'holy'/'sanctified' and 'unclean' have to do with the similar language used in 6:9-20 (also with context of sexual union)?
[C] What is the relationship between the second part of 7:14 ('otherwise your children would be unclean, but now they are holy') and the first (that the unbelieving spouse has been sanctified in the believing spouse)?
[D] The unbelieving spouse is said to be 'sanctified' and the child is 'holy'. Does Paul then mean the same thing concerning both spouse and child, or not?
Regarding [A], 7:14 is an argument or explanation as to why the believer should not initiate divorce against the unbelieving spouse. Some might understand it as saying in effect, "stay married because that will create a better opportunity for the spouse to know the gospel". While that makes sense as a reason against divorce, to use the term 'sanctified' seems an unusually round-a-bout way of saying it. Is there any precedent elsewhere of using 'sanctified' in that sense? Perhaps there is, the Bible is a big book :-)
In my estimation, I think the answer to [A] may have to do with [B]. Perhaps we should try to answer the question, 'Why would they want to leave the unbelieving husband?' Perhaps it could merely be that they don't particularly like the spouse, and just want to get out. If that were the case, perhaps the suggestion about evangelistic opportunity would be an appropriate answer (sacrifice for the sake of the gospel, etc). However, I think that the reason for wanting a divorce may have more to do with incorrect doctrinal understanding than mere convenience. Given the issues they had with proper sexual relations (e.g. aspects of 1 Cor 5-7) and also about right relationships with unbelievers (cf. also 2 Cor 6-7), I suspect that for some reason or other, the Corinthians might have thought it unholy, perhaps contaminating, to be in close and sexual relations with an unbelieving spouse (cf. some Jewish views of contact with Gentiles). Certainly after Paul's words in 1 Cor 6:9-20, a Christian married to a non-Christian might wonder if it would be a defiling of the temple of the Holy Spirit etc when they enter into sexual union with the unbelieving spouse. If the issue is something along those lines, it makes for a reasonable answer to say that actually the unbelieving spouse is sanctified by the believer, rather than the believer being contaminated by the spouse. Of course the question then is, what exactly does it mean that the unbeliever is sanctified? Perhaps it merely has something to do with the Lord somehow through the covenant of marriage, sufficiently 'cleansing' the spouse, such that entering into such intimate sexual union does not somehow defile the Christian (cf. the opposite in 1 Cor 6:15-20; or Matt 23:17,19 how the holy sanctifies that which it comes into contact with, or 1 Tim 4:5 how food is sanctified before entering our bodies). Maybe this sounds too airy-fairy, or maybe we are just too modernistic :-)
So onto [C], why does Paul even mention the children? If Paul just means that the children also should be in close contact with the gospel, again, the terms 'unclean' and 'holy' seem a very strange way to state it. Also, what does that have to do with divorce? The children may well have stayed with the believing parent. Instead, I think the way it reads 'otherwise...' (the whole construction in Greek is "EPEI ARA... NUN DE..") means that if the unbelieving spouse was not sanctified, then the children would be unclean. Notice also how it reads 'but now they are holy'. The emphasis seems to be that the children are indisputably holy. Paul is saying 'If what you Corinthians thought was true, then actually your children are unclean, but we all know that really they are holy, therefore your thinking is wrong'. It seems that Paul mentions the holiness of the children to bolster his argument for not initiating divorce. He says they should not initiate divorce, because the unbelieving spouse is actually sanctified afterall. How do we know the spouse is sanctified? Well, obviously it must be the case, because it is clear that the child is holy. I think that is called a posteriori argumentation. Why is it so? I expect the reasoning is that if the spouse was so defiling as to defile the believer, then one would also expect the fruit of such a union to be defiled. On the contrary, the children are holy, therefore the unbelieving spouse must not be so defiling as they had supposed.
Well, what about [D]? I don't think they necessarily have to mean the same thing. The verb used with regard to the unbelieving spouse is hAGIAZW, the adjective describing the child is hAGIOS. Obviously the two words are closely related, and I suppose that generally speaking it is true that the act of hAGIAZW-ing something will make it hAGIOS. Yet I am sure Paul could have used the verb for both child and spouse, or the adjective for both. But he didn't. Perhaps there is some significance in his choice to make a distinction. To put it crudely, I suspect that really it is the child that is holy (hAGIOS), and the unbelieving spouse is sanctified (hAGIAZW) 'enough', to ensure that neither the believer nor the child should become unholy. Perhaps there is the sense that Paul is comfortable to label children as 'holy', as included by God in God's covenant people, whereas he would be hesitant to call an adult unbeliever 'holy'. Yet he is comfortable to use the perfect verb form in that the unbelieving spouse is sufficiently consecrated or cleansed (hAGIAZW-ed) to bring them to a state such that they should not defile the believer or children, yet not enough to label them as 'holy' (hAGIOS). (Perhaps an analogy might be seen in with the verb AGAPAW 'to love' and the adjective AGAPHTOS 'beloved'. There are those that might loved, which we might be hesistant to call 'beloved'.)
In summary then, I think the sense is this:
"You think you must separate from your unbelieving spouse, because you are holy and they are not. Maybe you even think they will contaminate you. In fact, this is not the case. For your spouse has actually been sanctified in/by you. How do I know that? It must be the case. If they were not, your children would be unclean. But it is evident that your children are holy. (So we know that your spouse must not be as corruptingly unholy as you had supposed.)"
Or in other words, "we know your children are holy, therefore your spouse must be sanctified to some extent, otherwise they would be unclean. Therefore the unbelieving state of your spouse is not so bad as you cannot be in union with him."
So, perhaps that is a possible way to understand 1 Cor 7:14 (which naturally supports paedo-baptism, that being my position!).