My advice is to do what's best for YOU.
He wants her. You don't.
He wants to stay with her. You don't want what's currently going on.
You have no right to make a decision for THEM (unless you and hubby have set up with veto - but that doesn't sound like its the case) but you do have a right to make a decision for YOU.
When my hubby was involved with someone - I had to, at the end of things, tell him that I would never ask him to choose - even though we had agreed on veto - I loved him too much to hurt him in that respect - however I had to make a choice for myself. And I didn't LIKE the choice that was becoming clearer, but it was the choice that was healthiest for me.
You need to make the choice that's healthiest for you.