Reality

Here is my current dilemma. My exN was never diagnosed with this himself. My therapist suggested he may be a narc after hearing my first hour description of our four-year relationship. I began doing research, and I believe he has this disorder. I also believe I have codependency issues, and my focus right now is to work on identifying my attraction to this "type" of person and knowing what a healthy "me" feels like.
However, he lives across the street and has moved OW in. Over the holidays, I was contacted by an old friend whom I used to work with. Turns out OW is her sister-in-law, and for a while, I was being asked to basically spy on what they were doing, as she was lying to her husband about her whereabouts. I put an end to that, just stating that it was not in my best interest to know what they were doing, nor to watch them. My friend understood and apologized.
However, now that I have heard the OW describe me as the "scorned GF" and knowing that they are going public with this little fling, I find that exN is in my dreams every night. Sometimes he is with me, but only to tell me about her. Last night I dreamed that we lived in the same house with glass walls, so I had to try to avoid seeing that he had moved her furniture in, and watch them having breakfast together, etc...
During the day, my mind wanders to places I have traveled, or experiences I have had, and 95% of them were with him. Sometimes our kids were there, and other times they weren't.
I am seeing a therapist, journaling, reading, painting, writing poetry, meditating, doing yoga, using breathing techniques, playing empowering music, going to church, praying, staying involved with my children, family, and friends. I am doing the work! And I still find myself thinking maybe I was wrong about him. Maybe this is my fault. And I can't even look back at the really bad times, because every time I wrote something to him or about us that was about our problems, I destroyed them, because I wanted to stay positive and fix things between us.
I wonder if I am so tired of thinking about how crappy things were, I have just blocked it. That makes it feel like things weren't so bad.
I even asked my therapist if maybe I am the narcissist, and she said it is unlikely since I am the one grieving, working on myself, and not immediately involved with someone else.
I had my house up for sale, and took it off the market for winter. I don't like to run from this or him, but I seriously don't know how I am going to move on with the physical proximity.
I can't get him out of my head. I don't want to hate him because hate is just so painful, but I am exhausted with sadness. I want to have happy memories of my own life, but he was such a big part of it that it tarnishes everything. I am sad, and the reality is that not every moment was bad. We did have some things in common; he did have some positive qualities, and I did love him. And what hurts the most is knowing that none of it meant to him what it did to me, and he is not sitting around thinking fond thoughts about us. He is making new memories with someone else. It is what he does, and I haven't made it to the point of indifference about that.
We had been engaged. I always told him daily life would be so much easier in the same house. I was complicated though, as I have three children, and that would have meant adding on to his house or buying a new one. This OW has older daughters who do not come with her. She is just fitting right into the space left behind by me and the GF before me. It hurts that he has moved her right in, and she is living the daily life with him that I wanted, but was too much trouble to make it happen. She is the perfect supply, as she is there with none of her own things or children. She worked with her husband, so she is even quitting her job. ExN works from home, so he will have her undivided attention. And as sick as it is, I found myself wishing that were me. Rejection is so traumatizing.
I don't know what I intend to hear back; I just needed to get this out. I am afraid this has become depression, which means I did not get it all out, and instead I wrapped my fear around it and stuffed it down.
What do I do next?