The problem I am dealing with is that he & W are actually "family friends."

Then just say that to him: "If you were any other guy, I would have forwarded your messages to my H and would never speak to you again. Since our families are friends, I would prefer we just put all of this behind us. You will never say anything inappropriate to me again and I will pretend like you have never said anything inappropriate to me. However if you choose to say or write ANYTHING suggestive to me again, I will talk to my husband about it."