Frylock, that is better. I agree with a lot of what you said. Here’s a few more thoughts. Originally, White’s development was better than Black’s, until the b3 push. Since Black was behind in development at that point, it would not be wise of him to waste even more time pawn grabbing with his Queen. So White could have ignored that threat and continued developing, probably with 8. Bd3. In fact, Bd3 isn’t bad even instead of Bf4. If Black trades the bishops, he’s giving up his best piece. Also worth concidering instead of Bf4 is c4 or Bc4 (the c4 move restricts the light squared bishop a bit but does wonders to control d5, since the lower the value of a piece the better it is at controlling a square. That’s an aceptable trade off as your bishop won’t be effective on the a2-g8 diagonal after Black pushes e6, which he’ll have to do to develop his other bishop).
Granted, it would have been better not to allow the opponent to control and use d5, but where do we go from here? As you said, the bishop on f4 is in trouble. To defend it with the queen means that Black can give white doubled isolated pawns on the d file, a very bad thing to have happen to you. For the same reason it can’t retreat to d2. You could try Bg5, but it looks awfully misplaced when it’s forced to h4 or c1. So the only remaining option is 10.Be3. Should Black exchange it there, White will get a very strong center pawn structure and may be able to work some pressure on the half open f file.
Note that the promising looking Bxg6 doesn’t work. The reason is because after Black takes on f4, the pawn on g2 is defenseless, and that will keep the White King exposed with probably fatal results. Even though you didn’t see threats to your King earlier, it has very quickly become a deciding factor in the game.
So play Be3 and hope that Black takes it. He probably won’t. …Nc3 will probably tempt him irresistably, but it’s nothing to panic over. Black would be better off developing his kingside, and White needs to castle, after which his troubles are largely over. Still, I’d say the position rather favors Black, as he has the initiative. That occurred because White misjudged the center, overemphasising the e5 square which was already covered, and neglecting d5, which was completely available to the opponent.
By the way, the opening stage of the game is complete when the rooks are connected. That’s the definition of fully developed. However, the notion of control of the center is important during the entire game and not just in the beginning. And it’s easier to keep control of something you already possess then to wrest it from the other guy. This game will give you practice in doing exactly that.