Well, I know perfectly well, how intense and strong a connection can grow via the internet. I met my current partner while playing online as well. We became much more than friends over the course of 7 years playing with each other without seeing the other as well. The only difference in our case was, that we never talked about our desires and feelings. Till the beginning of last year.
I guess we have done some 'emotional cheating' as well. I knew for quite some time that I loved him, tried to ignore it, accepted it without admitting anything to anyone else and finally just couldn't hide it any more in the end. My husband and my partner as well never talked about this as something along the lines of cheating, I decided that I wouldn't regard this as cheating, since it has some active ring to it in my book and I never enforced those feelings willingly. They just happened.
But in your case, I would clearly start to advice your friend to talk to his wife. This problem is theirs to sort out. I know that it is hard to stay out of it for now, but don't (as you correctly pointed out) participate in their mess. As a good friend of yours, he should be able to respect your wishes and boundaries.
Facts: 30, female, bi, v-type relationship with Sward (husband, straight, mono) and Lin (boyfriend, straight, mono), poly-fi and co-primary.