you have to move on and accept what she wants. I understand where you coming from.
Accept and respect her decision.
It is better for the both of you to just stay as friends because it will just make your situation more complicated and you will hurt your loved ones if ever they found out of that. Having a deeper relationship with her wouldn't make it better. Sometimes we should just follow our minds than our heart because our mind knows what is right.
In this case I would most definitely agree that it is the best option to stay friends because of what she told you. On the larger scale, however, you may want to think things over. You say that you consider yourself heterosexual, yet you do say that you have had sexual feelings for women since you were young. Depending on how often you have them and on how strong you are you may need to recognize them at one point.
Now, I will not say that you have to or tell you what to do. Heck, you are far older and probably wiser than I am, but I do know that ignoring your feelings is not right. If the feelings bother you in any way then I do believe you should consider accepting them and coming out about them somehow.
I agree with what everyone seems to be saying, and that it's not worth it to destroy a perfectly good friendship, but the heart wants what the heart wants.
Careful, the first thing I say to anyone about relationships is to ask the question are you really in love with this person, or are you in love with yourself and think that this person would complete you. One means you'd do anything, including dying, for them and you don't want anything in return. This is the "gift" of love. The other option is that you think this person will somehow complete who you are, and this is dangerous only in you shouldn't call it love, because everything you do will have the strings attached that you want this person to reciprocate back to you. In this case the focus is you, not them. All you have to do is decide which it is, and be honest with yourself and that other person, then you stand a change of building a physical relationship.
Now, too my thoughts on this subject -- the heart wants what the heart wants.
Have you thought of ways of making her address the issue without pressing it on her? Like this: if you get a girlfriend, who you are physical with, then you stop spending so much time with your best friend, and she has to make a choice and the issue is in her face without you forcing it on her. She has to decide how close she wants you, and if she can have what she wants too.
If you move on, as suggested, then this may help her address the issue. She may actually be attracted to you in the same way, but is FEARING change that is outside her normal realm of control. She may be content to leave that as fantasy because it doesn't risk her current status quo (sp?). You can cause her to adjust her game plan completely by controlling what you can control. You cannot control her, obviously.
If she's constantly around you, then this is getting in your way of finding some attention that you want, so move on quickly... life is too short. If she ever comes to you and says she's more open to the idea, and is wondering what you have in mind, especially after you've been dating someone else, then you can show her your feelings again, and say that you really didn't want to go elsewhere, but thought that it might help you not be so frustrated, and help her not have to get attention from you that she wasn't ready for yet. You can always break up with the girl you've been seeing under the statement that your true love has shown interest and it's not fair to her, and you can tell your best friend that you've only ever wanted her to come around and that being with someone else just helped you express who you are more freely.
Don't play with people's emotions unless you are serious because people do not take kindly to this behavior, and often react violently when they think they are being manipulated. Best thing to do is to explain to the person that you may start seeing what you are trying to do from the start, and they may or may not be willing to join the experiment. Be prepared to possibly end up with another best friend because once you get emotionally invested in someone it's hard to break contact.
Not putting any more attention on your best friend is key to this though. Be the friend that you both need, and work in an area that you can control. It will mean you hang out less, so if you don't want that, then this really won't work.
Thanks to all for the valuable info. I appreciate your honesty.
yes...i totally agree with them.... you have to move on and respect her decision if you don't want to loose her or she might end up your friendship because of your feelings towards her which isn't not good for both of you.....