LOL
What should be the next move here?

Back bishop or take knight?
You'll have to deal with this decision on a case-by-case basis. Sometimes it is correct to capture, sometimes it is correct to retreat, and sometimes both are okay, and just a matter of taste.

I have a tendency to believe bishops are generally worth more than knights. When a player pins a knight like this you have to ask yourself is the knight worth more than the bishop. pinning the knight on f6 weakens the center for black. the f6 knight defends key squares in the center; e4 and d5. so ask yourself, is the knight worth more. Unless you can capitalize with an attack or lasting advantage, the bishop is a long range piece and tends to have an advantage over knights.

I think you're right--in general, but every chess position has its own character, so you can't rely to heavily on general ideas. I'm not good ebnough to be confident about this, but my feeling is that after either Bf4 or Bh4, Black plays c5 and already has a little initiative, SO Bxf6 is the least bad choice in this particular scenario, where White has already thrown away a precious tempo for no reason.

I think it's hopeless to try and find rhyme or reason in White's play. It's legal, but stupid. The question about when to trade bishop for knight is an interesting one, but this was a poor example to work with
Back bishop or take knight??