Carma the way I see it, your issues have almost nothing to do with Barbie (or even Butch) and everything to do with Sundance. He is not being honest... You say he has lied to the g/f, but if he admits to lying to the g/f what has he been lying to you about? People don't just lie to only one person. The fact that he claims not to be in love with her I don't see as the real issue as some people take a lot longer to feel love, but the fact that he is encouraging "cowgirl" behavior is very disturbing.
This lack of honesty MUST be dealt with, it is and will continue to erode your relationship with him. Based on other things you have said, it almost sounds like there is a revenge factor and maybe he is trying to "even the score". It sounds like you guys need some professional counceling, I doubt this will just fix itself.