@Hello19,
If you get in the thick of this, any blame, arguments, or problems will be directed at you, almost no matter what you say or do.
Why? Because in situations like this, people tend to shoot the messenger.
As for your girlfriend's sister (Sydney? I'm losing track of who's who here), just say, "I don't want to hear it." And then go and do homework or housework or watch TV or go for a walk or take up clog dancing or whatever – just remove yourself from the situation. At some point, she'll realize that she no longer has a gossip buddy in you. If that tanks your friendship or your living situation, then those were pretty precarious things, yes?
Should Brandon fess up? Sure he should. But that's not your call. It is
his. You've already pressured him to take action so back off. The fact that he hasn't (at least, so far as you know - what if he told her and she forgave him? Weirder stuff has happened in the world) is none of your concern.
If it really bothers you to think that he's gotten away with this, then think about what it means to stay friends with someone who you think is a cheater and a liar, and too cowardly to tell the truth. If you want a moral dilemma in here that badly, maybe that's it. Maybe think about what that means for you and your continuing relationship with this BFF of yours.