As the others have stated, it's quite normal for a man to have a hard time getting 'up' or staying 'up'. In my husband's case, he had a difficult time maintaining an erection in the presence of another man. When we were with just a woman, he was rock hard. Factor another man in the scenario and...well, his penis had attention deficit disorder.
I'm not sure how you feel about swapping in a different room, but that might help. Maybe your husband would feel a bit more secure if he wasn't around you (no jealous thoughts, no guilty feelings) and he had the full attention to one woman. You could begin light play with all four people. Put on a show with the other bi-woman for your husbands, have some light play and then split off into pairs in different rooms.
I'm not sure if ya'll are comfortable with this, but it might be something to consider.
And too, perhaps time and comfort will solve his mechanical problem. As he gets to know the other couple on a more intimate level, things will naturally work out.