This is the way I'm interpreting everything. He had a sexual attraction to men and was in denial about it. Then he accepted his feelings and started a relationship with that man. I'm sorry, but the fact that he suddenly stopped having sex with you when he became friends with that man is indicator. I think having a relationship with a man wasn't what he wanted, so he returned to you after he sorted out his sexual feelings. Why he chose that particular toy, I don't know; perhaps size or hardness?

He may be bi, but certainly not gay. Despite telling you otherwise, all signs point to him having a sexual relationship with that man.