Oh Jakana, I so feel for you. It is not easy to see your loved ones unhappy, and please do not blame yourself. All you want is the very best for your DS, do make sure that he knows this (it is easy to assume they know).
In my experience, it often takes at least six months to settle into a new situation, find your way and your feet sort to speak. Those six months can be very tough, and many dont get through them, but those who do often find that the other side is brighter than they ever could have imagined (that sounds really weird, but the best way I could find to explain it)
Would it be an idea to discuss this with him? Say that you hear him and feel his pain, and you suggest you try for another half a term or so (or even until next exeat to start with), then re-evaluate. Then if things are looking a little brighter, re-evaluate again at the next juncture? Small steps and milestones you can work towards together?
I am sure you both put a lot of effort in to get to where he is today and he has accomplished so much to be proud of. However, this can be hard to keep sight of sometimes, so it is worth reminding both himself and youself of that fact.
I wish you all the best of luck and please do not give up!