The fact that you and she have been able to have an open and honest discussion about this issue is HUGE and it bodes well for a good outcome.
It sounds like the major issue here has nothing to do directly with either of you - it's all about him and his honesty.
So, if you don't mind me asking - are you going to put sex with him on hold until you have worked this through? Or is she ok with you and he continuing to have sex?
"Listen, or your tongue will make you deaf." - Native American Proverb