Yeah, that's a tough situation. You are wise to tread cautiously.

Truth is, no matter what you get him, she won't like it because she is already jealous of your relationship. You could give him Chuck E. Cheese game tokens and she'd be pissed. Does she know about the thoughtful, expensive gift he got you? Somehow I doubt it--which would mean there's an element of dishonesty in their relationship now. So the real problem here isn't the gifts, but her jealousy of your friendship.

But you already knew that.

I think you should give him whatever the heck you want to give him and not worry about it. I'm guessing you and this guy were friends long before he met this girl, and you will probably be friends long after their relationship is over--which might not be too long from now if she is that petty and insecure.

I understand that you don't want to get him in hot water, but her jealousy is their problem, not yours. Your goal is to honor his friendship with an appropriate gift, so do that and let her handle it however she wants to handle it. Chances are, he won't tell her about your gift anyway. If he does, she will hate it regardless, so why bother tiptoeing around her?

By the way, just because he spent a lot of money on you doesn't mean you have to reciprocate. Gifts don't have to match, at least not in cost. The most important thing is the thought, not the price tag. Don't spend beyond your budget just because he went more expensive than you expected.

And don't worry about competing with her gift. She probably got him a leash.