Need help dealing with people and friends

I am writing here about how a Christian is supposed to deal with difficult people. I just don't know what to do anymore.

I have an acquaintance from the university I go to,and I just find him very difficult. He is very touchy, very easily offended, and I feel I am walking on egg shells around him. I have witnessed to him, and so I feel an obligation to continue to keep contact with him and invite him to my place for lunches and dinners.

Recently, I had a guys night with this friend in my home, and we were playing the x box games. We were playing racing games, and he was continually coming last,and in jest of course, having a bit of fun about it. Not long in the night, he said that he had never played this before, (neither did I ) and said he would leave to visit some other friends.

Another incident is that one time he was making fun of himself continually one night about his car with a lot of hail dents in it. Then I decided to make one jestful comment about his dented car, and he got offended.

Another time he was telling my wife about a female university friend he had met, and my wife, in jest,was egging him on about having a girlfriend. At which he got stroppy.

I just don't feel comfortable around him, because I feel I have to watch every word I say.

What is the right thing to do, in Christ's eyes? Do I just give up on this person and cut off contact with him? I just think of the verse that says that if we invite those who we like only, we are no better than the sinners, for they do that too.

Is this part of our cross to bear? Or is this an unreasonable load to bear and I have every right in Christ to pick and choose people who I associate with?
Is this part of our Christian walk to befriend and invite those in our home who we may not particularly be thrilled about, simply because they may have few friends and it is the Godly thing to do? It's just that I am tired I feel of giving out good and getting back bad. Another university friend too I have done the same thing, witnessed to, had over for countless lunches and dinners, only to find out that she talks behind your back about you. When I found this out, my first reaction was that I would not have her over to my house anymore for lunch or dinner.

Appreciate any comments.

I would just like to say thanks to everyone for their advice. It has been helpful and I will take all your advice into consideration.

I must confess that for a while now, I have begun to keep a distance from a lot of people. I haven't been surly or rude or ignoring people, but I have begun to lose my outward hospitality, openess and friendliness. If someone wants to chat to me, great, but I have stopped approaching people and have begun to keep to myself.

Part of the problem is that no matter how much nice you do, people can be so intolerant and unforgiving, and for just one little indiscretion, much good can be negated, and suddenly, you are the evil one. When I see people that are quick to dislike you, or talk about you, I figure what is the point of pursuing friendship with them, as sooner or later, something will happen and you are the topic of scorn and conversation. Like I said before, the person who talked about me, has had countless dinners and lunches and stayovers with my wife and I. I just don't feel like inviting her into my home anymore. What's the point, I can put a lot of effort into a friendship, and you know later down the track, you will be slandered and talked about. Just knowing this person will slander and talk about you at the drop of a hat, puts me off in being a friend, and I don't feel like doing it anymore.

After all, you can't give out what you don't have, or have lost.

In case you have looked at other topics in this website, I have put threads and replies in the music section. Yes, I am the Tomy whose favorite band is Black Sabbath. And yes, I am a Christian.

I don't want to have a hard heart, for that is of the world and Satan, but I don't want to be taken for granted either, and be everyone's doormat. There has to be some sort of Godly compromise.