You need to tell him...
I think you have to have that discussion as uncomfortable as that may be. Funny thing about things we fear, once we face them, they don't seem near as scary. Give it to him straight, tell him how you feel, he should be open to that and at least try to understand. If he can't, then DADT is not going to help anything. Sooner or later it is going to come out. I think you should face it now and give him a chance to process it all. Who knows it may be just what he needs to get his engine running again. Good luck.
There can be no failure to a man who has not lost his courage, his character, his self respect or his self-confidence. He is still a King - Orison Swett Marden