will this circuit work as intented?
It looks plausible. 1K is probably a bit low for the resistors on your diffamp. Try 10K or 20K. Don't expect it to work too close to the supply rail(s) even with rail-to-rail input and output amplifiers/comparators. You may wish to restrict the range of adjustment of S and R pots to keep within the common mode range of the parts, and perhaps reduce the gain of the amplifier somewhat, and choose deliberately whether you want the pot range to exceed the possible output limits of the diffamp or not. 

Also, note that you will have no signal at all if the secondary sensor is greater than the primary, because the output voltage would have to be negative. Maybe that's of no concern to you. 

There is also no guaranteed gap between S and R, in fact you can set the pots so they overlap, so you should consider what that means- typically one or the other output will "win" on the RS flip-flop- for example on the 74HC74, both the Q and /Q outputs go high when both /S and /R are active. It wouldn't be too hard to buffer the wiper from one pot and use it to feed the element on the other pot if that made more sense. 

Edit: You could use something like this to prevent the two settings from overlapping by much. If you added a diode between the buffer amplifier and the pot, you would guarantee a gap of 600mV or so between on and off, over most of the range.  







simulate this circuit &ndash; Schematic created using CircuitLab