I've confronted him before, but it just makes him hide his tracks better.

If this is seriously the case, then your marriage is already over and you just haven't faced it yet. You husband is fishing for sex on Craigslist. Let me repeat that: Your husband is fishing for sex on Craigslist. Your marriage lacks trust and honesty and commitment/loyalty and respect - and you don't even confront him about it. You need to care about this. If you are OK with your husband is doing then he should not be hiding it - it should be out in the open. If you are not OK with what he is doing then you need to confront him when he does it. If he keeps doing something unacceptable then the difficult reality is that the relationship is beyond repair and needs to be ended.

I don't have concrete proof he's taken this to the physical level, but I wouldn't be surprised.

I mean.... are you even UPSET? Your response to him putting adds on Craigslist is to reward him with kinkier sex in the bedroom. That's... inconceivable. How do you feel about this? Is this not a dealbreaker for you? How can you be so nonchalant? If you're OK with him going outside the marriage then that should be something the two of you actually discuss and agree upon. He should not be sneaking and doing it. You mentioned you are not OK with fucking another man but perhaps you are OK with your husband fucking another woman/and/or/man. If you're OK with it then put it out there as a solution. Tell your husband you know what he's up to and it's time to shit or get off the pot.

At this point, I feel we are just not compatible sexually and should consider separating.

Sister, you're not the only one. Yes, you are definitely not compatible with this guy. But you do seem to be compatible with being treated like a doormat and not defining and defending your own boundaries.