I personally would stop letting the new pup go potty in the house even if it is on Pee pads. This sends mixed signals to Cody. Besides if the ultimate goal is to house train the dog then eliminate this other behavior of going in the house so it doesn't cause issues later.

I am not a fan of dogs being house trained on pee pads when there is access to taking them directly outsides.

I agree with Aly that Cody could be marking his territory because the scents are in the house. Marking territory outside is not a problem and is really quite common in male dogs. Especailly if they show alpha characteristics.

Bottom line.... get rid of the pee pads and train the pup to go outside from the get go!