You just have to use the crate. I know it seems mean but really you are just supporting your puppy's success. It really does work. Even for older dogs. They do whine, but it subsides. It really is harder for us in the begining, we love them so much and just don't want to "lock them up". But it really is best for them.
 
When left alone they have to be in a crate and also at night. Once they are potty trained(meaning they can show you they want outside(either standing at the door or barking at the door or ringing a bell at the door) and consistently go in their potty place) then give him a bit more freedom.  
If they have more accidents then back to the crate training. Record pee times so you can look back and see if peeing is really becoming more frequent or you are forgetting to take him out. Or maybe he is peeing more and has an infection. Recording all potty and feed times, nap times on a chart is so valuable I find. Give treats always for good pottys outside in their potty place. Also, really consider getting rid of the indoor pottying on pads.  Most dogs I think, need a bigger separation of where it is ok and not ok to "go". We are using a small fenced off area in the yard and even if our dog pees outside of this area, we correct her by placing her back in this area. Eventually she will see that this area is her "toilet" and no where else.  
Our puppy is 16 weeks and runs and sits at the back door (even in the middle of play) to go do her #2. She is regular with her #1's about 90% of the time. Pee takes longer to learn. I think they just can't feel it as well as a #2 coming! 
Good luck with this, I am sorry your Teddy is stressing you. He is so sweet. 
Here is a good youtube link on Potty training.  
Also, try the The Loved Dog by Tamar Geller, it is a life changing book for people and dogs. Her training approach and life philosophies improve all areas of dog and people behavior, I loved this book. She has a website too and some video clips as well. 
Hope something here helps. 
Mary
