E.,
I have two sons, ages 5 and 7, who are both well-behaved and adjusted (according to their teachers and other adults they encounter like friend's parents.) They are not perfect in any stretch however. They are boys, and I expect boy behavior out of them.
Dr. James Dobson's video series (also a book) Bringing Up Boys was helpful to me. My expectations or norms as a woman do not always apply to my sons. I think there is a reason why your son does better with his dad. Part of it IS the roughhousing. That is good for boys. It tells your son that his dad thinks that he is worthy of time and attention. It tells your boy that his dad thinks that he is strong. It reminds your son that someday he will grow up to be a man. Those are important things.
I know that you're concerned about rough play with friends. I would just keep an eye on it. If the friends come running and screaming about how your son hurt them, then it needs to be addressed. Otherwise, your son is just being a boy. You might be able to tell him, "Not everyone is as strong as you and your dad." or "Your dad is the only person you know strong enough for that kind of (hug, wrestling, etc)" I know that might go against your grain as a teacher. Keeping control of a class is different than parenting, I think. He's right at the age where he needs a bit of freedom. If you have neighborhood kids or friends he can invite over, send him into the back yard to explore.
And don't make him play with the younger brother unless he wants to. I'm sure that's an attention or annoyance problem--younger brother gets too much, so he says he "hates" him. It's not true, and it will go away. Wait til his brother worships the ground he walks on and follows him around as his sidekick in a year or two.
When your son says, "I am the best ____ ever." Agree with him. Add some other things that he does better than anyone else you know. Tell him how amazing he is. We tell our kids all the time that they are the best kids we know. Positive self speak--doesn't that sound like psychobabble--is something that we all have to learn to do. That's the thing that will keep him going later in life when he has tests to study for, projects to do, jobs to get, contests to win. My older son will often say that he can do ____ better than his younger brother. I usually agree with him, and then say, and when your younger brother is your age, he'll be good at some things too.
As a teacher, if you want to make a HUGE difference in your son's self esteem, teach him how to read this summer. You're not going to roughhouse with him. It's not your m.o. But you can teach him and praise him to high heaven for every word, sentence and book that he reads. Both my 7 and 5 year olds are fluent readers. The 7 year old is reading on a 5th grade level. The 5 y.o. is heading into Kindergarten this year and hasn't been tested yet.
Where conceit comes in is when they treat others as less than themselves because of their own self-worth or lack thereof. I personally think that some of your son's moodiness has become manipulative with you. He doesn't get to cop an attitude with you or use mean words with others. One of your other posters talked about setting boundaries. I agree with her. You need to be firm with how he speaks to you and others.
Words matter. So does respect.
He needs to speak and act respectfully to you and others. If you only discipline for bad behavior and mean speech--it's not about him and his person. (Be sure to differentiate between cruel name-calling like stupid/idiot and regular boy vulgarity Doo-doo head) He is a good kid, looking to define himself and the world around him. He has a lot of change right now--school, mom going back to work. It's stressful for a little kid. But you can't change his mood. It's not your job. In reading this, I thought that you were trying too hard. The world does not revolve around him. Instead, tell him you need him to help you bake brownies. Tell him his brother isn't old enough to help. Or enlist his help in picking up something. When dad comes home, tell dad what an incredible job the son did in whatever it was.
I wouldn't spend another minute trying to logically convince him that he's happy. It'll only make him dwell on the miserable. If you were teaching him in your class, as someone else's child, you would have redirected him to something else, or just kept the train going, until he forgot about it. If he deliberately hurts his brother or disrespects you, either send him to a time out or ask for an apology or both. Your skin needs to be thick enough that if you send him to his room or a naughty seat or something, that you can ignore him wailing, crying, pouting, screaming etc. until he stops.
Also--I'm not sure where you are in the metro area, but various cities, Newnan, Peachtree City, have summer theatre programs for children. Some of what he does screams artistic temperament to me--some of his statements to you are total drama. Maybe theatre or art classes? I think this would be far more beneficial than a psychologist, and cheaper in the long run. My kids also loved a science camp. Getting out in school environments with other children away from mom can be a great thing.
It's possible if he likes it rough that he'd enjoy some of the sports programs available for kids that age--soccer, t-ball, football.
E., I hope that I haven't said too much. I really respect you for laying it all out there. So many people are concerned with what others will think, and they never ask for any assistance.
Please let us know if any of this is helpful to you.
E.