Most dogs will hate to be wet and will stop peeing in their bellybands, this is not the case for all of them though. I would say your dog is marking, when they are that old and they pee only a size of a quarter then they are marking. Training your dog not to mark is not the same as housetraining them. Your best bet is to put the belly band on him inside to protect your furniture and carpet because it will only get worse. Neutering may help, but not always.
When I first put a bellyband on Scampers he would pee in it all the time like that is what he was suppose to. As time went on, he hated peeing on himself, so I would put it on him in the house and take it off to go outside. Once outside he would pee and he would no longer pee in his belly band, that does not mean that he won't pee inside without the bellyband, because he will mark without the band on, but when it is on, he stays dry. Bellybands are really the best you can do for a male dog.
In my opinion, it does not confuse, maybe a little at first, but after a while they get the hang of it. So you may notice that your boy will pee alot outside and maybe only a little bit with the belly band on, because he was marking. After time, he may not pee with the belly band on at all, but I would still leave it on when inside.
You will need atleast two bands, one to switch when one is dirty. You can order them at
www.barkindogclothes.com. They have material built in that absorbs the moisture so that if your dog does pee it will not be wet and get on everything, these are the type I really like. With other belly bands you have to have a small disposable pad put on the band to absorb the moisture and I think these are a pain and not very comfortable for the dogs.