I have considerable insight into this kind of thing. I am going to say important stuff. If any of this makes sense to you PM me (or ask me to, if you're not allowed to PM yet.) I went through this kind of stuff in a 3.5 year long online relationship when I was in my later teen years. It changed my life and I really hurt her in the process, so I'd be happy to talk to you about it from his perspective. He needs to wake up to a lot of stuff.
He gets off sexually by feeling feminized.
This can be a fetish (i believe this qualifies as transvestism but it's so hard to keep track of all of our types), or it can simply (and by simply, this is a far worse thing) be that he wants to be a woman. Ask yourself if you'd be able to feel turned on as a woman if you were covered in body hair/stubble, wearing a flannel shirt and denim overalls, with your partner fingering your clit and talking about your nice cock.
That's sort of what it's like for a person who has a hairy male body who's got female desires trying to fill the male sex role. Masculine dominance requires a LOT of energy, activity, and drive. And that is simply difficult, 'unclean', or impossible if you do not want to be in that role. Lingerie and wigs and such overlay femininity over the masculinity and make it easier to feel comfortable with yourself. If you are comfortable with yourself, then it's easier to do other things. The arousal likely doesn't stem from the feel of microfiber and lace, but from the feeling of expressing oneself and being able to be aroused because they're suddenly open to it.
There is a tremendous amount of guilt involved. All of society, all of a man's life, everything forces rigid masculinity on a man. With feelings/secrets like that, repressed for years, it festers, it can go rotten. Most importantly when you begin to strip away the layers, all of that suddenly starts coming out the top. It's like a giant zit that's finally starting to drain, and at some point, probably explodes. I made that less graphic that I wanted it to be, but honestly it can be very nasty, destroy relationships, and hurt lives.
He's slowly progressing towards what makes him happy. As he gets more and more he's going to focus more and more on his freedom because he's wanted it for so long and it's new and important to him, and available. This is where you get marginalized and the troubles spring up because he simply can't see anything but the freedom he's gaining. This is the selfish stage of someone exploring gender issues, and unfortunately, we can get very, very selfish.
He needs a lot of patience and understanding, love, and care. He needs to be receptive to this and work with you, but pride, shame, and such are quite difficult barriers to break down, especially as you get older. Your relationship may very well not survive all of this, but the important thing to realize is that if neither one of you is getting what you really need out of it, then that is not a bad thing.
My honest advice? Get a strapon. Either come home one day wearing big, baggy mens' slacks hiding a strapon inside them and let the evening progress towards sex; he takes your pants off and out pops a cock (please buy a quality one.) Or while he's dressing up for foreplay go into another room and whip it out and strap it on. His reaction to the whole situation ought to tell you a lot.
You should read some transgendered erotica (english.literotica.com) - it'll mostly be stories about men being forced into the feminine role, having to dress up in makeup/clothes for some arbitrary reason, and how much they enjoy it. It's an expression of how they dodge the guilt bullet by having it 'forced' upon them and enjoying it and it being revealed how good they are at it and how appropriate it is for them to be the little made up slut instead of just flat out doing it of their own volition. It should give you some insight into the psyche that he's probably living in.
It is very hard, at first, to separate 'wearing a thong and a wig and sucking a cock' from 'being a woman.' It took considerable time for me to recognize that femininity exists as something more than actions between the sheets, and it took making changes that are visible 24/7 to deal with it. Living much closer, physically, to my mental desires, has really made everything so much better.
Granted, that's still appealing (well, not that I need a wig with my gorgeous hair) on a very core level for me, but I'm sure you enjoy feeling sexy and getting rogered by men too.
