Don't tell the wife and don't spend anymore time with either of them.  If she asks you why, ask her if she really wants to know.  Then be prepared for her to hate you forever.  The guy basically just cast you into the role of homewrecker, no matter what you chose to do.  Not. Your. Problem.  Walk away from both of them.  She may or may not eventually clue in that she's married to a creep, but it's not your responsibility to spell it out for her.  She makes her own choices.  Just dump them both and enjoy your own marriage.