Sorry, but I have to disagree with what is being posted here. Time for a reality check. If one of my friends was in this situation, this is what I'd tell him:
Your friend sounds to me like a user: he wants his cake and to eat it too. It sounds to me like he wants a wife, but without the strings that come with marriage, but all the benefits. And for him to have YOU as his wife is safe and allows him to date/fuck around: he's not gonna have sex with you, so he doesn't need to worry about that side of things. AND he gets someone to help him raise his kid. Have you become the full-time babysitter yet? It's coming. And he gets to approve of whomever you date - do you get a similar privilege? Sounds controlling to me. And the fact that he thinks it's fun that you have the nude and sex pics only tells me that he likes to be the center of attention.
Look, he may not be doing this intentionally or maliciously, but on some level he knows he's got you in his pocket, so to speak. But YOU know, deep down; otherwise you wouldn't have started this thread. YOU know that this relationship isn't healthy. YOU know he's using your crush on him for his own advantage. YOU know these things.
Look, I don't mean to harsh on you; we've all gotten involved in unhealthy relationships. But honestly, a good relationship is one between partners. Does this sound like a partnership? From what you've written, it doesn't to me. Plus, if you really, truly, deeply, love him, can you handle him seeing/fucking/loving others, orientation aside? Jealously will come, my friend, and the green monster doesn't go away, it only grows. If this were a straight relationship, I would say this is borderline emotionally abusive. Actually, the genders and orientations involved are unimportant: this IS a borderline emotionally abusive relationship.
So this is what I would tell my friend: Think of yourself and your own well being first. Sometimes a little bit of measured, reasonable, self centeredness (sp?) can be a good thing. Leave this situation before you get in deeper. This will not end well.
I'm sorry, but this situation needed some straight, blunt talk.
Good luck. Stay strong.