My advice - Give him everything he wants (so far). But make every bit of it cost him.
Every time he uses one of its special powers, it devours a bit more of his soul. Every single time he uses it, have him take a random point of PERMANENT stat damage. Place those points into the sword. At certain times, the sword can compel him to act in a certain way (to propogate its own existance) if it successfully rolls under the number of stat points its taken from him on a d20.
What's that, he doesn't want to have kids? Tough shit, your the swords bitch now, and it wants you to have kids.
1) He can use the powers and abilities of anyone who EVER used the sword
Huge increase to skills and abilities, but he needs to spend a round summoning it forth (at the cost of a stat point), and then it last four rounds (at which point he can pay another stat point to continue the effect for four more rounds)
2) He commands anything the previous owners ever created.
But ONLY when he's using the above ability. ^_^
3) He can reanimate any soul from within the sword (recreate any being within the weapon)
But it costs him a stat point and only lasts 10 rounds the soul stays in this reality, AND he has no guarantee over control of the soul, and the soul has no intrinsic understanding of what he'll want it to do.
4) The sword and the owner become one despite him having to give his soul to the sword.
I don't know what this even means.
Anyways, when he complains about the cost, kindly remind him that great power comes at a price, and if it weren't the case he never would have gotten the weapon in the first place, would he have?