Call me a cynic, but I don't think love and good sex are enough.
Something is Missing Between You Two
It is very clear to me that something is missing in your relationship, and that letting go would be the best thing you could do for yourself. I think his infatuation is a symptom of something missing between you two.
The only times I've felt infatuated outside of my close relationships were when I felt like I wasn't getting enough of something. In some cases it was attention, or respect, or sex, but it was clear that I was looking outside to find what I wasn't getting inside the relationship.
What tipped me off was that you two had a breakup, he got to be involved with the object of his infatuation, they didn't end up together, yet he still pines for her. In other words, she didn't take your place, but on some level, you are not exactly what he wants.
The Outside Interest is the Excuse
The outside interest is the excuse for not facing his true feelings of dissatisfaction with your relationship. Also, as long as this issue is out there, he can never feel comfortable.
There is nothing you can do to make him resolve the ambivalence. Therefore the best thing you can do, for you, is to wish him well. He's got to sort it out for himself, and playing his therapist can only hurt you.
I suppose it is possible that after he resolves these feelings that he might come back to you...but I really think that there is nothing YOU can do about it. So, if it feels right to wait and see, do it. But, make sure you're not fooling yourself, and that you're not hurting yourself by hoping in vain.
The Dance of Relating is the Hard Part
My belief is that in many ways, love and sexual connection are the easy parts. It's the dance of relating, trusting, and making it work even after the chemical connection is there that is the hard part. Many men never learn how to hold up their part of the partnership in this dance.
Women's challenge is finding one who can.
Men's challenge is learning how to dance...