The hard part is, that because of her (potential) unstable mental and emotional state, he is very fearful to provoke her in any way and is therefore still not willing to cut things off. Is still hoping she will... What do I do with that?
Help...?
You treat it as you would any other addiction, Rocked. You say "I'm sorry to see you in pain, and I'm REALLY sorry to hear you're not willing to end what you yourself admit is a destructive addiction to you. I've already told you that I won't share you, so I guess I have my answer. I have some decisions I need to make."
And you keep it open-ended.
Yes, everything he admitted to you was good, but he's now doubled-down on the OW. He's saying "I'm a pyromaniac, I REALIZE I'm a pyromaniac, but I won't give up my matches." So you need to let him know that you are considering removing yourself from the situation.
It is a chicken-and-the-egg when a fogged-out spouse says "I'm not willing to give up OW/OM, because I'm not yet ready to recommit to the marriage. The marriage commitment is a DECISION, and he cannot make that without giving up the contact with OW -- he himself is telling you this.