Man, shitty situation. I hope you can find some help, either from books or professionals or the internet or a spiritual practice or whatever, because that's no way to live and you deserve a better life and inner world.
One thing here did jump out at me: "... I can either lie to make him feel better or tell him what's actually up and potentially lower his quality of life and instill in him a similar amount of anxiety ..."
Talk to him. Assume he has good emotional boundaries, and can hear what you have to say without taking on your suffering. Your emotional state isn't his, and he may have quite a different reaction than you would in his shoes.
One thing here did jump out at me: "... I can either lie to make him feel better or tell him what's actually up and potentially lower his quality of life and instill in him a similar amount of anxiety ..."
Talk to him. Assume he has good emotional boundaries, and can hear what you have to say without taking on your suffering. Your emotional state isn't his, and he may have quite a different reaction than you would in his shoes.
Good luck man.