It is not your fault.
I think this client is misusing you and your friends. He is putting the preisure on you as high as possible to get you working for cents an hour.
From now on you have to play it harder.
Let a lawyer check your contract and legal situation. From my experience there are always large holes for interpretation.
Charge him a large sum for all work on features and changes not part of the initial project scope and bill them. You need a strong counterweight to his claim. I think 1,000 of hours are.
When communicating with him, overdraw everything you are doing for him, the amount of work, the extras, the pain, etc.
Do you have agreed to contract penalties when failing a dead line? If not. Just give your best and everytime you face a changeing estimate, just tell them. Take the time you need!
Deliver only the minimum required according to the initial scope and then tell them the project is finished.
For the future:
- dont work so much for more than two weeks in a row
- take time to refresh
- be selective with customers
From my experience with similar situations, I can say that you'll learn the most from this kind of problems. You'll be stronger and happier after it.