Well, Sisterfriend, this is a confusing and difficult situation to be in. HOWEVER... if he INSISTS that you keep it, then keep it. BUT... GET IT IN WRITING, GIRL!!! I've watched too much of Judge Judy Judge and Judge Mathis.
That way, if he gets technical about it and HAPPENS to take you to court or something about that bracelet (which is a very FIIIINNEE piece of equipment, if I must say so myself), then you'll have all of your ducks in a row. Make sure that you reiterate to him that you would ONLY keep the bracelet if something can be written and if he clearly understands (and state this in the document) that you have absolutely NO romantic feelings for him in any way, shape, or form and that you are taking the bracelet as a PLATONIC GIFT from a FRIEND for your birthday and that you BOTH understand that to be the case. I think that should do it and perhaps you won't feel guilty about it. Plus he wouldn't be able to say that he didn't know how you felt.
Frankly, I don't know what I would do either. Taking an expensive gift from a guy who has feelings for you (and you don't feel the same) could play out in many ways. Just make sure that this dude is not some psycho or stalker or something. I'll just leave you with this... do what your HEART is telling you to do (that's usually how God speaks to us). Only you and God know if you really are taking advantage of this dude. Personally, I don't see it as such, but YOU make the decision.
Good Luck and I know that whatever you decide will be the right decision for you.