I have a great friend who means the world to me. She has been there for me throught a lot and I have for her to. We've been getting veeerrry close now and I'm staring to really fall hard for her. She also seems to be interested in me and we're very physical with each other. (holding cuddeling even falling asleep on each other) However, she has a boyfriend who is a total jerk to her- I mean a real asshole and he somehow is Important enough to her that she refuses to break up with him. They fight all the time and here I would die for her. What's wrong here?

she is with the jerk because that's who she wants to be with. she complains to you because she likes the attention you give her. the cuddling and such is way more than friends give, so naturally you are starting to feel more than friends. basically, she's emotionally using you.
If you are opposite sex, you can make a move and get incredibly lucky, or, just ride the friendship until it hurts so much you have to move on yourself. As she gets older, there is no way she is going to have an opposite sex friend around; its just not going to happen, future lovers or spouses will never be tolerant, its just not realistic. The reality is if she was interested in you in any way, you would not be on this site asking this, and she wouldnt be with other guys. She likely just likes genuinely being with you as a friend, possibly using you as above but im sure she actually likes you, just not in the way you like.