oh dear...tell someone ASAP! it's not right...and as someone's mentioned above, do you have sisters? female cousins? other young female relatives? just think he could be a risk to them too, and i'd hate to think of him ruining more than one life. just how far will he go? you definitely need to tell someone as he's not being a normal dad.
i read a book once about child abuse. the poor child grew up thinking that kind of behaviour was normal. perhaps you've been thinking the same, but the fact that you've spoken out on here would suggest even you're having your doubts now (rightly so)... tell someone before it's too late.