I would recommend you stop free feeding NOW, your other dog will get used to eating just when it is dinner time (it might take a couple of days, but she will get used to it, it will be a training issue with her, but she will eventually learn she has x amount of time to eat and thats it). Free feeding is BAD for dogs with weight issues, and is actually the cause of a lot of dogs (and cats) being overweight. I don't know of many vets who support free feeding.. ask your vet their opinions on free feeding and if they think this is contributing to the weight issue.
They need to be fed in separate bowls and in separate areas. Do you crate your dogs? I crate Leo (Pomeranian) when we go away and he is fed in his crate. Gunner & Leo get fed at the same time but do not eat out of each others bowls because they are not near each other when being fed. Sharing a bowl is NOT good either, because you can not really judge for sure how much each dog is getting (why one dog is probably fat and the other is normal or small).
Not measuring how much food you are giving is not good, especially if you just changed foods .. if you went from say an IAMS to the Natures Recipe you would have to cut down on the amount you are feeding because natures recipe is likely richer in protein than the Iams would be... usually with a more expensive food you feed less... We have a measuring cup in our dog food containers so we know exactly how much they are being fed.
As far as exercise goes... Everyday I walk my dogs on my property or we let the big one chase us on the ATV but my dogs rarely leave our property for a walk ... My big dog has OCD and runs laps around the tree in his enclosure we figured it out and he runs about one mile around the tree every time he goes outside (he goes out at least 3 times a day).
Based on the variables you have given I would:
1. STOP FREE FEEDING
2. Feed separate and in individual bowls
3. Measure how much food each dog is being given
4. Daily exercise
Make sure you consult your vet to see what type of a plan they think would work best for your individual dog. We did do a few other things that were custom tailored to our dogs specific needs.. but the big one was monitoring exactly how much he was eating.
He can loose the weight... it is in your control (Unless your dog knows how to open the pantry or refrigerator). Good luck!!!