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"My wife knows all of this and she has basically said I need to get over it (in regards to the lack of inmate interaction) and see what happens. She tells me that nothing has changed from before this all started in regards to her feelings toward me, so why is there a problem. I tell her that I was unhappy before and in regards to that aspect of our life I am still unhappy."
This needs to be addressed somehow. Is your wife giving you the okay to date anyone besides her friend? How would you feel about that? What about your intimacy with your wife? Even if she has identified as lesbian, isn't there some way she can have a close emotional relationship with you?
I think that your wife's friend should know more about the situation in your marriage ... just my opinion.