I think he had a right to know his child.
I think she has a right to know her biological father, and in 10 years time (or less) when she knows the facts of life she is going to ask about him.
However, I think the needs of the child must come first. At the moment, she is far too young to be told her back story (or understand it) and for her sake he must agree to whatever timetable you think best.
So. I would let him have photos of her. Initially would consider letting him meet her very occasionally, not in your home, always in your presence (and DP if he's willing) for an hour or so, in quite casual social ways, perhaps at the play park or out for a walk; and just introduce him as Jim, an old friend of Mums. That's all he gets, for several years. So he is a figure in her life, just someone she knows. By then he might come to your home for a meal or spend an afternoon. If it doesn't work out, he can just fade back out of contact.
Then when she's known him casually for several years and is old enough to start wondering about her origin, you , DP and him, can decide when and how to tell her, Jim was your father. By then, she'll be old enough to have a voice in how much contact she wants. Might be more, might be less.
But meanwhile, he is just an old family friend. He never has sole charge of her, she doesn't meet or hear from his wife, parents, children.