skeeweeaka, I wonder if whether your XH has NPD makes a difference? Maybe you can just go on his past patterns of behavior to answer your question. You have known him for many years. It sounds like he has constantly disappointed you, manipulated you, and taken advantage of you. I am not seeing any evidence of change in what you have written, only his words, which in the past, have not been worth much. If it were me, I would not let him move in with me until he had shown substantial evidence of change. You can still have a family even if you live separately.
I am separated from my H and well on the way to divorce. My T has told me my H has NPD, but in the end, I don't care. What matters is how he treated me and the family. He also has his good traits, and I believe has been a really good dad. We are living separately, but within a few miles of each other. We both work. We share custody of our kids, although I have more time than he does. We cooperate on transporting the kids to their activities and talk weekly or more about family issues that come up, such as discipline for the kids (so we can be consistent across two homes), coordinating vacations, trouble the kids are having with friends and homework, etc. We are co-parenting. Sometimes we even do things together, the whole family.
I tell you all that just to show that you can have important elements of family life even if you are separated or divorced. Our kids are doing well with this system, and it helps me too, as I cannot tolerate negativity and I'm not sure I could handle one of those acrimonious divorces where the spouses are so hateful to each other.
Would you be able to establish a successful-two-homes family like this? It might be the first step toward reconciliation. Could you ask your XH to move nearby you (under no circumstances should you move to be near him!) and demonstrate his ability to be a responsible co-parent with you? Your daughter could split time between the two homes, and have the advantages of being with her father and her mother. Your H could demonstrate his ability to be responsible and dependable, a good father, hold down a job, earn and save money. You can do activities together with your daughter, go to dinner together with her, go to school events together, go out to movies together--all the things a family does that lives together. You can "practice" for being back together and see if he is able to carry his weight in the relationship. If he can do all those things for perhaps 3 years, then maybe yes he has changed. And maybe then consider living together with him again.
Not trying to tell you what to do. THat's the approach I would take. It would be hard for me to trust your XH after all he has done so he would have to re-earn trust and demonstrate functionality.
I just wanted to share my story so you know that you can have many elements of a family with your daughter even if you and your XH do not live together.
Best of luck.
A book that might be of interest:
Mom's House, Dad's House: Making Two Homes for your Child.