So maybe he is telling the truth, sleeping separately, sitting in different rooms, what difference does that make to you.
You claim the guilt is killing you, so if he ever left her and the children, how would you feel then, even worse I should imagine. He knows this and has picked you especially for the job.
He is using you, that is a fact.
Your friendship is probably keeping him from resolving the problems in his marriage, a power struggle at home.
To me that is worse as it seems he needs you as a 'friend' and is using sex occasionally to keep you invested in the friendship.
He has probably been stonewalling and using the silent treatment on his wife for years to get his own way. You may actively being used to abuse his wife in other ways than just being unfaithful. You are helping him through the boredom, whilst he de humanises his wife.
He actually sounds like a bully to me, knows you are an empath and uses guilt to reel you back, for his own ends.
This man isn't your friend, block contact properly, you will then see his reaction. I should imagine he will be overly nice at first but go nc and his true colours will show, he is controlling this situation and if he loses that control he will become annoyed or angry.
If you end this , he will just find someone else to use, someone also who can be manipulated that doesn't ask him to leave his life, someone who gives but expects nothing in return.
If only you could see this man is your enemy, he has stolen your life and any chance of happiness, he is controlling both his wife and you.
Please get away from him, he is not a good person.
I would wager he is a narcissist.