I feel for you mate, it's not a nice situation to be in at all.
It sounds to me like you two don't have a future together and I suspect you both know that but niether of you is willing to come out and say it. It takes a lot of guts to finish a relationship with someone. It's so easy to let things drag on and on, becoming more complicated, more confusing, and more hurtful when it finally finishes.
My advise would be to break up with her immediately and break all ties with her, at least for a while. She'll look back on your relationship with fondness and appreciation that you didn't allow things to deteriorate too far before ending the relationship. She'll respect you for it and what's more important is that you'll respect yourself and go into your next relationship feeling bigger, better and stronger for it.