Lawrie,
Welcome to the Board. I'm sorry about what's brought you here, and I understand why you would be confused. Given this is a Friday night, things are a bit slow here, but others will be by to greet you in due course. In the meantime, I've got a couple things I'd like to share.
I would caution you to not diagnose him with any sort of character disorder like NPD. While I can understand you looking for some explanation as to why he's doing what he's doing, only mental health professionals are qualified to diagnose someone with that sort of illness. Just because we read the DSM, for example, doesn't mean we can make a qualified diagnosis.
With that being said, it's clear to me that he's sick. Someone in the throes of active addiction will behave narcissistically and without conscience. They will also swing the other way ("I'm a failure", "I'll never get better", etc) when they're looking for someone to feel sorry for them.
The good news is that you're aware that the "honeymoon" stage is over, and you've got quite a bit of information on him now. My guess is you're not confused about any of this. You may not know what to call what you're seeing, but you know something's wrong. And you're right. The question is what do you believe is in your best interests going forward. Not what you want, but what's in your best interests.
Want to know what I think?
When he says he can't love you the way he should, I would take him at his word. Because he's right. As long as he's poisoning himself, he's incapable of being a committed, responsible romantic partner. You wish him well, you keep him in your heart, and you detach from him and begin the healing process. Otherwise, he'll take you down with him.
Don't just take my word for it, though. Read as many posts as you can. We've had countless new members like yourself find our little corner of SR in similar situations. And I think what they've all learned, to one degree or another, is loving someone is not a life sentence. Just because you love someone doesn't mean you should be with them.
Anyways, this is probably a lot for you to absorb. Be kind to yourself, and be patient with yourself. You're amongst friends, and if you allow us to, we'll see you through this.
Again, Welcome to the Board.