Hmmm, I must agree I would hate this and it would be a deal breaker most certainly. There is a massive difference between watching people having sex (like a movie) and interacting with a single girl. It is prostitution really.
I would just add this though. If you say you are okay with porn to your DP (or now any future DP's!) it is worth discussing boundaries especially in the internet day and age. DP and I have discussed that mags and DVD's and internet porn of the same type (i.e. watching 2 people have sex) is okay, but webcam girls and anything that is interactive is a big, big no no (no Babestation here). This is fine with him and not a big deal as he doesn't want to do that anyway. If he did then it would be a problem as he would be giving up something he saw as his right just for me which could lead to resentment.
I know for you now this is shutting the door after the horse has bolted, but I know lots of people who have been in your position and then the man answers back with a defensive 'but you said you didn't mind porn'. He is most definitely going get angry and defensive and say it was your fault because you were all 'cool' with porn. (its not your fault BTW, you have given him an inch and he has taken about 10 miles). TBH he will know it is wrong but will use the okay with porn thing as wriggle room.
Its a bit like the guys who go to strip clubs and their girl friends cheerfully wave them off, and then the guys gets a private dance and is all shocked when the girl is so upset. To the girl its obvious he overstepped the marked (or bloody well leaped right over it) but the men always come back with, oh but you said it was okay to go, so how was I to know a private dance was off limits.
Posters on here often say that being all 'cool wifey' isn't not the way to go and I think they are quite right. If the man you are with needs someone who is all 'cool wifey' about things and you actually don't feel like that, then essentially you are just not compatible.
Whether its porn, strip clubs, monogamy, or swinging, all areas of your sex life (and life in general) need to have the boundaries agreed on and understood by BOTH parties, and stuck to.
Goof luck OP, I really feel for you. I hope you manage to come to some sort of resolution, in your own mind whatever the outcome.