Hjorimir said:
Look at it this way: you're doing him a disservice by letting him go through life thinking that such behavior is widely acceptable.
In my sight, he is unfortunate. He is clearly intelligent and strives to be articulate. I can appreciate these traits. He even is witty in general, and there were times that he would say something that was really, really funny. That was about 20% - 40% of the time.
But you know how when you're a generally funny person, but you're *trying* to be funny way more than you comfortably are? Perhaps there are just so many jokes that can be made in a five-minute time frame, but whatever the reason they just keep falling flat? Half of those would get old, and it was plain he was trying way too hard to be the wittiest person there.
He also wanted to have all the answers. There is a great strength in knowing the rules, and that should not be overlooked. However, every time I would ask a question to the DM, he would answer for him. Things that only the DM could decide on, like the surroundings and details of the world. I'm not talking about something that I simply didn't hear the first time, as would be appreciated. Each question I would ask, he would interrupt (!) the DM and chime in his guess at an answer. That not only slowed things down, but can begin to be VERY annoying.
Ironically, I was one of the loudest voices at the table against the (lack of?) balance with Exp. and equipment, which were some of his biggest beefs as well. However, you have to trust the DM and play by the rules provided regardless of your view on them, or you simply stop playing. I presented my problems and offered solutions in a very long email to the DM directly. He was very responsive, agreed with me on some major points and returned well thought-out answers for those he did not agree with. Until those changes and the like were absorbed into his style for that game, I played by the rules set forth, even though at the time I thought them to be very unfair. The changes were made and we were rewarded for our patience. Was it everything I wanted or thought we should have? No, but these activities are a social contract and this is part of it.
Instead, and while this was happening (I announced to the group, with him sitting there, that our side had been presented and a valid balance would be struck in game very soon), he simply complained loudly about them over and over, then began to verbally attack and attempt to intimidate anyone who did not agree with him. This only took two sessions to change! I'm not talking about three months here. His past experience with DMs were ones that could not be trusted and would do whatever they wanted regardless of what you said, so I can understand even that you do what you are shown... but he's gone so far as to expect that poor performance from every DM now, and it's back-firing.
His character actions Keifer touched on, but needless to say a Lawful Good Knight should not go around threatening frightened commoners and party member/NPCs. It simply speaks to a fair amount of personal bottled anger, which does nothing to help the situation. His actions revolved around either intimidation or retaliation for imagined slights. I find it telling that the game he moved to from ours ended in another character attacking his character.
As to the woman he kept touching, that is my wife. I was simply waiting for her to deck him. She swam the mile competitively without kicking and won awards in college for it. I fear her upper body strength.

But seriously, it is simply not appropriate to touch people whom you are unfamiliar with or just met. That's not just at the game table, but in life as a whole.
In regards to paying money at each game, that was grossly mis-represented in his post. Each session we all pay (including the DM) three bucks which are tracked on the website. This money is used for replacing equipment we all use, from the mundane items like pencils or dry erase markers, to the more expensive like a mini fridge for group use. Anything over 20 bucks gets voted on, anything less can be purchased at any time by the DM within reason. At the end of the "season" (usually a full year from when we started), the left over money is spent on a big feast in which we all bring guests, and awards are given out (player of the year, most improved, etc.). Sometimes, depending on money, they are simply printed out certificates. Other times, they are engraved plaques.
I find this to be a great reason to pay and enjoy doing so. The end of season feast is always a great social event at a nice restaurant. Usually, unless you missed more than half the games or something, you and your guest eat for free and the plaques are simply a neat little perk. Kind of like being in a sports league and winning a trophy.
No one is "paying" the DM to run the game... He doesn't get to spend it on anything that is not "for group use", so it is a moot point.
All that said, I think that if he worked out some of his anger issues and stopped trying to be the center of attention so much, he would be a really good player. He's not as hopeless as many I have had the misfortune of playing with. However, it is clear that he is going to end up jumping from group to group until he is either trapped with horrible gamers but has no choice or he simply has no game to call his own unless he realizes that sometimes the common denominator of all your failed relationships is you.
I would defintely have him at my game table (with or without the group in question) again if he took this as constructive criticism and showed a willingness to learn from his mistakes. That would require him recognizing those mistakes and not blaming them on others. Still, I think it *could* happen. Regardless, I wish him luck in the future.