I can't begin to guess at the cause of the spike to 20+, but the early hours hypos are most likely to be caused by still too much lantus.Weight loss combined with exercise will have made an enormous difference to his insulin and food needs. Don't be afraid to cut the Lantus down even more than you already have. I find that one single unit difference in Lantus dose can make a huge difference in BS. I don't now if that's just me, or if other people find that too, but that's my experience.
You say his short acting dose is average of 7 -8, but does he use a ratio of insulin to food to work out how much insulin to use? If not, then, with his new, more active lifestyle, it might be a good idea to see if he can get on a DAFNE (or local equivalent) course to learn how to adjust his insulin scientifically instead of by guesswork like I did for years and years. The course changed my life after thirty years of struggling with 'unpredictable' hypos: I learnt how to avoid them.
Also, does your husband test before bed? And if so, does he act on the result?