Okay, first of all, I kind of do think you are overreacting. Maybe you are letting your feelings and your history get in the way? I mean, why would you expect romantic things from him if you are JUST FRIENDS, as you say you are? I think you may still like him...
Also, you invited him so you are obligated to pay in my book. When I took guys to my formals and stuff, I was the one dropping cash so they could get wasted - I spare no expense to show a guy a good time!
(Okay, I spare some things - I'm not slutty!)
Anyway, I agree with the people who said he's just a guy. College guys - at least for the most part - like to get "tanked" once in awhile, and hey, so do college girls - NO BIG DEAL. Also, while I am sure he could have fun even if sober, Even I think that a few drinks make a huge group of girls more bearable - and I'm a girl. Afterall, there can be a lot of drama that comes on formal night, and it sometimes freaks guys out.
I say take him to formal, knock back a few and live it up!
Oh, and as for the people who say go without a date - I disagree. You don't want to sit around and watch all the girls having fun with their dates and be sad. And, even if you can dance with your sisters, who will you slow dance with? Only go alone if you really don't want to take him, can't think of ANY other good guy-friend options and don't trust your friends enough for a setup. I mean, I'm independent and all, but some things are just more fun with a date!