I have a good friend who got close to, and married a woman sort of like this. She not only tried to con him (had access to his credit cards, his kid, etc.), but con his friends as well, and made up all sorts of bullshit stories to support her insane world view.
She claimed to be pregnant as well, once he finally kicked her abusive ass out the door.
(A) Get that paternity test, tout-suite.
(B) If he's only keeping her in the house because he's afraid of not having contact with the child, then SHE'S CONTINUING TO MANIPULATE HIM.
There is nothing wrong with having her go her own way, and then suing for custody once the baby is born. That is, if the baby's his. Yes, she could up and leave and cause a hellish nightmare for him if he wants to see the baby, but she WILL cause a hellish nightmare for him AND for you by staying there, because she can.
I apologize for my tone, but I saw what this woman did to my friend. He's happy now, but she took a man who was smart and confident and really fucked with him for a while. And all I could do was watch and try to help from the sidelines. It's an awful feeling and I hate to see someone else go through something similar.