Yes, I am sort of seeing this from your point of view too cbg. This sounds more to me like a personality conflict, a workplace bullying spat sort of situation that the employer couldn't fix anyway, since the other party isn't his employee.
If this OP were to quit his job and come in and file a claim for unemployment, and go through the whole nine yards of how this man has been making his life a living hell for THREE YEARS OR MORE, he would probably not be very likely at all to get approved for unemployment insurance while looking for another job. Because first of all, it can't be too awfully bad, can it, if you have put up with it with very little action for THREE YEARS?
And the first thing they'd ask is a lot of questions trying to determine if you have exhausted all reasonable alternatives to quitting before you quit the job. And a huge reasonable alternative to quitting the job is first of all, you let him know you do not appreciate what he is doing and that he should stop doing it. Personally. To his face. Then you inform your supervisor about the problem with the work conditions. ESPECIALLY, even if they've blown you off before, you go back in and bring it up again when others who are in your work venue are disturbed by the situation and are finding it hard to do their work because of the situation.
And if your supervisor is a wimp or is unsympathetic to you for some reason, when you have made it very clear to him, with documentation of exactly when you have had these conversations and what has been said in them, you GO OVER HIS HEAD. Who owns the darn place?
Then, of course, there's always the alternative of going to the employer of the person who is harassing you. It doesn't fly that "Oh, he'll just get a slap on the wrist and come back after me worse......boo hoo." Come on here, man up. If the situation is already so bad you are about to quit your job over it, how can he make it so much worse that you're afraid to try to fix it? That reasoning, particularly carried through for three years, just makes it sound like the situation hasn't been too bad, if it could get so much worse, it's just annoying to you and you'd like it to stop.
The thing is, you can rarely fix a bad workplace. If you need to find another job, you'll know it, and if this guy is not the only reason, then you need to do it.
Think of it this way. If this person dropped dead, just vanished from the work scene, would you then have the dream job? If so, open up and do everything you possibly can to fix this problem. Don't let this one person take you out of a job you otherwise enjoy.
The guy may just be a jealous jerk who wants to get you fired or persuade you to quit your job. There's nothing illegal about that. He's just being himself. Your employer is not obligated to provide you with a happy and trouble free workplace where everyone is nice to you. He may simply be a bully who has found that you are seriously bothered by his strutting and aggravating behavior and comments, and so he entertains himself by playing with you. The thing to do in this case is change your responses to his actions and comments. Obviously what you have been doing for three years isn't working.
But think long and carefully about it all. He is a huge downside to the job you have. Is it worth dealing with him? Or do you just need to walk away from the situation (probably without unemployment benefits) and find another job?