Dump the boy.
It is never, ever worth the time and money and frustration to work with somebody who is unwilling and unmotivated.
In this case, you have to put aside YOUR dreams of your daughter competing with this boy and instead consider her feelings first.
Look at what has happened: an eager, motivated, talented child is turning into an unhappy and discouraged child because of this boy. No matter how nice the boy is, he is BAD NEWS and will be a hindrance to your daughter's dancing career.

If you want her to keep her enthusiasm and joy for dancing, dump the boy now and have her dance pro-ams with her teacher. If you keep her dancing with this brat, she may quit dancing altogether.