I want to lose 15-20 pounds by this summer but I'm realizing that with all of the workouts I do, I'm gaining a lot of muscle and not losing the weight. What am I doing wrong?

Muscle weighs more than fat so if you work on toning your body by using less weight and more reps you should get the results you are looking for.

For your header for your post it states "knee surgery is preventing". Can you get out and jog or speed walk? If so this is a great way to lose allot of weight. Cardio as well.

Well that is another problem. With the knee surgery I had, I'm still not able to do a lot of running or jogging. I do the bike almost everyday but is it true your body gets used to doing the same things and you end up not losing any weight?

Wait, do you want to lose pounds or do you want to burn fat? There's a difference. It's possible to weigh 260lbs and have almost no body fat. Which is it? If you want to lose pounds, as in you're already at a low fat percentage and you want to cut weight, you should lay off the strength training, stick to some cardio. If you want to burn fat, don't use the number on the scale as representative of your progress.