What works for some people doesn't work for everyone, but here's my take: Having male genitalia may be a requirement for you. This is ok, and it's not your fault. But it doesn't mean it has to be a deal breaker. If you really love everything else about the relationship, and still enjoy the sex you can have, but it's not 100% of what you need, you need to explore your options and what matters to you. Society has told us our whole lives that there is one person out there who we are 100% compatible with, but society also tells us that there are two genders and they're determined by the genitalia that you are born with you. If you're here right now, that means that you're willing to consider that society isn't always right about these things. You mentioned thinking about an open relationship in your initial post, and it's not actually a bad thing. I know quite a few people who have made it work rather successfully in all sorts of scenarios. It's about being willing to let go of preconceived notions about relationships and build one from scratch together. It's hard, but it's not all bad.
If your relationship provides 90% of what you need and want, it can be very sad to walk away from that in hopes that there will be something better. Yes, it is emasculating and painful to hear. But I think it would have been more difficult and emasculating to find out that my partner left me and gave up on everything awesome that we had because they didn't think *I* could deal with discussing difficult things. And there are any number of reasons that a couple might not be completely sexually compatible that aren't exclusively anatomy related, sexuality is complicated.
I am FTM and in a committed open relationship with a primary partner. If you want to talk more about how it works specifically, or anything about it, feel free to ask or PM. I will warn that it is difficult and requires *a lot* of communication, you need to understand what you're getting into and it's not something to bring up lightly. At the same time, I'm not convinced that monogamy is any easier and frankly, people should be a lot more concerned about diving headfirst into it than they are. I highly recommend the book "Opening Up" by Tristan Taormino if you're even thinking about it.
If you decide not to go that route, it also doesn't mean you do or don't have to leave him. Sometimes, you choose to be with someone who isn't the greatest sexual match because everything else is worth it. And sometimes you stick out tough patches where none of it's good because you know it is worth it. And sometimes, it's not worth it. I don't really know how you decide, I renew my decision every day. I also want to point out that there is a good chance all of the "happy couples" you look to and wish your relationship was more like theirs, they're not perfect either. Relationships are hard. For everyone. For different reasons.