What are you comfortable with? That’s really what it comes down to. If you’re not comfortable with him being friends with this particular female, in this case his best friend, then it’s likely not going to work out. If you’re comfortable and fine with him having hooked up with this particular female best friend, then you go and do what you want.

From what it sounds like based on just this description, you thought you made a joke and the delivery probably wasn’t the best time or place, but regardless it wasn’t received well. With that being said, their reaction to it wasn’t the most promising if you want to pursue things. For him to storm off and for her to call you a B and follow him isn’t the most comforting response.

Opposite sex friends, even with past hookups involved, doesn’t guarantee cheating in the future when they find someone else/enter a relationship. Their response is definitely odd, but unless you know they’re still hooking up, then it’s all assumptions for now. With that being said, are you comfortable with that? If not, then I think you have your answer. If you are fine with him being friends with her, then by all means pursue. If not, then don’t.