Alright my friend. You are definitely in an emotional bind.
I have one question for you, and only one.
Will you be able to watch her be with another guy while being 'just' friends ?
From what you have told me, I don't see you being able to do that. Your emotions are going to get in the way. It is only natural for you to feel jealous towards her (and bitter towards the guy) if you see her with another guy.
Jealousy is a natural conviction of love my friend. So don't be ashamed to admit to your answer to the question above. You are only human, thus, you will only act like a human.
I say, take time away from her. Whenever you feel you want to be her friend again, ask yourself the same question as above. If you still feel that tinge of jealousy when trying to answer it, then do not bother with her at that time. You are still not over her. This could take months, or years.
If she is truly an empathetic girl, she will understand that you are doing this to spare yourself emotional distress, not sexual distress. If she is of the stuck-up kind, then she will take it as a personal insult. On a side note, if you do plan to take time away from her, you should definitely tell her so as to clear up any confusion. It is up to her whether or not she will be willing to believe you.
Stay strong, and be sure of your decision. TRY to act selfish for once --- being selfless can be just as dangerous. Right now, you have to think of yourself. If being her friend right now is going to be misery, then don't be her friend right now. In essence, it is a simple situation. Emotional however, it is a maze.
Your brother,
"I still find each day too short for all the thoughts I want to think, all the walks I want to take, all the books I want to read, and all the friends I want to see."
- John Burroughs