It sounds like you are doing the best you can in the situation. Also, trying to protect yourself emotionally as well as financially.
One thing to keep in mind.... oftentimes when a spouse "gets closer" (such as with that platonic kiss at Christmas), they will then pull away strongly. That's pretty typical.
Try not to worry about OM and your wife. And don't say anything negative to her about him. In fact, if you ever do happen to get into a conversation with her about this tell her he's a great guy and you wish them happiness.... boy wouldn't that really throw her!!!! She wouldn't be able to argue with you about him, see him "to spite you," or push the whole thing in your face to hurt you and create distance.
There is no arriving, ever. It is all a continual becoming.
