(Original post by Former)
^ I think he simply means that you're more likely to spend less time with this dude than to cut him out altogether.
This friend of yours sounds pretty horrible. Worst of all, what he's doing is proving effective. I wouldn't resort to giving him a taste of his own medicine, however tempting, for it would make you no better than he is. I recognise this probably isn't the done thing for you men, but you could try taking this guy to one side and say that as much as you appreciate his new-found confidence, him putting you down is just not cool... Alternatively, if practical, carry on going out without him (harsh but necessary) and, chances are, he'll ask why you haven't seen each other as much recently. I imagine breaking it to him that way may be the easier option, actually. If it turns out he doesn't even go as far as to approach you, forget about him altogether. It could just be a phase, but you don't need to put up with his antics for the time being. Besides, you have other friends, and just remember that it's his problem, not yours.
Sorry to ask, but you haven't ever treated him like this in the past, have you?
Also, out of curiosity, why is it that you would feel guilty for leaving him out and not for "playing him at his own game"?