I suppose that it bothers me because when it's both of us cuddling with him at the same time, I feel like I'm more of a groupie than a girlfriend and that our intimacy is devalued. That she's intruding on a special moment between us and has no right to do that. Those are just my very base thoughts and obviously not that grounded in logic :P.
I don't think I could handle telling both of them together just yet but I'll definitely start by confiding in my boyfriend. When I think about it, it would seem off if he were to just ignore her all the time. Especially as I attend a lot of their events now. Sometimes I feel that it'll be a long time before I'm completely koscher with it, so it's easier to think in terms of "everybody else has to change" :P. I know that my boyfriend still gets very slightly jealous sometimes when he sees her with her husband but snaps out of it using logic. It's possible that I've also reached that kind of point where those feelings are there, but I can probably find a more systematic way to deal with them instead of trying to instigate more changes. I think talking about it would actually help me determine that.
Thanks all for the input so far