Her relationship with him is a big part of why this happened (at least, I feel it is) and so I treat it as if it was an affair.
How?
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So, I've been down the affair route with her, and there is not one (at least, if there is, she's hiding it very well from me and his wife). We hang out with them almost every evening, I've met him, hung out with him, his wife, his kids, everything. There is an unnatural attachment, but it's not an affair, at least, AFAIK. If it ends up being there is an affair, oh well, I tried to discover it and failed, she's gonna do what she's gonna do.
All that I can determine is the "affair route" you've been down is you quizzing her about the R with her uncle, and her lying about it. You "choose" to believe it, but even your eyes are seeing that their R is not normal.
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After hanging out with my wife and her uncle and his family at our house, I blew up at something that he did that I felt was inappropriate. I asked my wife to come to our room and got upset with her. I said that if there is something going on between them to let me know and we'd get divorced if that was what she wanted. She said there is not, swore up and down and I believe her. But I could tell I had ruined the progress I'd made over the last few days. I texted her later and apologized for blowing up (but not for getting upset over the behavior).
My question to you is why are you hanging out with him and his family? Why are you having them over to your marital home, as if everything is just dandy?
I think you need to be more specific about what you know is not quite right between your W and her uncle. What did he do that was inappropriate?
It is not about what you feel should work in your M. It is about doing the work that gets the right results. Do what works!