As an officer or a guild leader, doing favors for your friends is one thing. The situation described below goes way beyond that. This one just blows my mind. Let's jump right into it.
I'm by no means an officer or leader of a guild but I am a very active raider. We use the EP/GP loot system in our guild; it calculates how often you raid vs. how much gear you acquire and based on that gives you priority when looting.
Myself, a raider who attends almost every major raid, and an officer who tries to be there when he can, have both been wanting a certain item to drop. I finally pass this officer on priority and if the item drops it should be mine.
Our last Naxx raid the item drops and I put in for it, and suddenly it gets awarded to the officer. I confront the guild leader about this, knowing he is friends with the guy and he gives me a vague answer such as "I'm sorry I know you're pissed at me, but that item has been destined to be his for a long time, I'm sure you'll get the next one." What kind of answer is that?! This is supposed to be a fair loot system right? So I go and confront the officer that was awarded the loot, after several minutes he told me that he had made a back door deal to get that item. He had just bought the guild a new Ventrilo server, and the condition he made to the guild leader was that he gets that item when it drops.
Some might say, "Well he spent his money on this for the guild, he should get something in return." Come on, really? I myself have purchased a Vent server for a guild before and asked for nothing in return, as I'm sure many others have for their guild as well.
Does this mean that loot is now up for grabs if you can cut a deal for something with the guild leader? I myself did not make this public knowledge to the guild, but sometimes I wonder if I should or not. At this point one might say the loot system did not hold up and this could easily turn into an officer/leader award loot system; how am I supposed to trust this won't happen again with me or with someone else?
To put it bluntly, you can't. Loot systems, particularly complex merit-based loot systems like EPGP, must be sacred. If your raiding members are to have faith in the system, the rules of the system must be obeyed. You can of course make exceptions for items like Val'anyr, but those exceptions must be announced ahead of time.A deal like the one you describe isn't an exception to the rule. It's essentially a bribe, using real money. The fact that your guild leader would agree to that kind of deal is one thing. The fact that he conspired behind the backs of the other members -- and then wouldn't even admit to it when confronted -- is just cowardly and reprehensible. Then when you consider that it was an officer benefiting from the deal, the situation looks even uglier.
Your guild leader is corrupt and the loot system is corrupt, too. It's the same kind of corruption you see in politics when, for example, a government official takes a bribe to let a company off the hook for polluting a river. Obviously loot in an MMO is far less significant, but the fundamental ethics are the same.
I wouldn't have a problem with this situation if everyone involved had been honest and upfront about it.
Did the guild leader even ask other members if they wanted to chip in for a Vent server? If a guild is successful, people are usually willing to help out. It sounds like no one even had a chance to volunteer.
If everyone knew about this deal in advance, they could have made a choice about whether they want to attend raids when an item they're looking for won't be available. As it stands, there was no way for anyone to know -- and it seems like no one else is aware of what really happened even now.
Deciding whether or not you should expose this bribe is a serious matter. It will certainly shake up the guild, and it could have serious repercussions both immediately and down the road. If it were me, I would ask my guild leader to come clean to the rest of the guild about what happened. Give him the chance to be honest with everyone before you expose him. It won't make things right, but at least he can apologize and promise never to do such a thing again.
If he refuses to, then, in your shoes, I would go public with the information. But I'd make damn sure I had all the right information about the EPGP points to back up the accusation with solid evidence. Take screenshots as soon as possible. For all you know, your guild leader could go back and doctor the system to make it look like his officer deserved the drop after all.
If he forces your hand like this, you'll probably have to leave the guild after you expose him. But at that point, would you really want to stay there anyway? At least you'll have the satisfaction of making sure your former guildmates know what kind of guild leader they're really dealing with.