I went on 2 dates with him

So I met a guy a few days ago on the internet whom we will call Marshall. Such a hot guy!!! He was 43, 5'10'', 190lbs, 6'' cut, brown hair parted down the middle with blond highlights. So my type. He just moved here from Arizona and has only been in California 2 weeks. He has spent the past 8 years though, here on business regularly.

We chatted on the internet for several hours, became facebook friends, then decided to meet up. We did dinner Saturday night at Buca Di Beppo in Irvine. I know why I was attracted to him- he's so random, his mind goes at 100 miles a minute, he is very much a type-A personality, he reminds me very much of The Guy as far as being so talkative and random. He sells Mary K cosmetics, does sales for a trucking company, and a range of other things. The conversation was nonstop.

We met on Sunday night too, this time at his apartment. We made out in the doorway for literally 15 minutes. We made our way to his bedroom where we stripped, and started kissing, cuddling, making out, and then we jacked off on each other. Lots of talking in bed about how hot of a time we were having.

We chatted on the phone Monday and Tuesday. Everytime he was telling me how awesome, how sexy, how perfect, how much of an Adonis I am, you get the pic. Total nonstop praise. While it does boost my ego, it left me skeptical. What kind of guy is he, and why is he saying that? It left me sketpical how he can praise me so much. He was telling me how he has a hard time admitting, but I'm one of the hottest guys he has met/talked/seen in 10 years. I was skeptical as to why/how he can praise me so much. On one hand it is flattering, but it is a bit much coming from a guy nearly 20 years older. Sure a "you're hot is fine," but the perpetual praise was extreme.

So tonight he was telling me how he rarely has sex. I asked why. He said long story short is he is NEW to California. He said he IS/WAS partnered in Arizona for 8 years. His boyfriend in Arizona is 15 years younger for him. They last had sex on like August 15, 2006. He loves the boyfriend and they get along great because of their love of dogs, but he doesn't like having sex with the boyfriend. His boyfriend is into funky stuff like tying him up and duct tape. Much more praise and back to talking about how sexy I am.

Right now I'm not sure what to think. He's head over heels for me. I was distant from the beginning and careful to not get swept up in his words. Now I'm wanting to ease back. Am I wrong? I don't know how to tell him no when I am just as guilty of telling him how I'm into him, yet didn't know he IS/WAS partnered. Ugh.
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As much as I hate to sit and compose a letter I think this may be the best thing... opinions?

Dear Marshall,

While I have enjoyed getting to know you over the past couple of days, I cannot in my heart, in good conscience continue seeing you as a friend with benefits/ a possible relationship (since you are seeing someone)?

Mike

OR................

Dear Marshall,

I have enjoyed getting to know you over the past couple days, but feel I cannot continue seeing you for sexual favors.

Mike

I don't know.... I know he's going to pry, ask questions, wonder what is wrong with him, why I can't, be butt hurt, potentially dramatic... ugh. Is honesty the best policy?