They aren't fucking monsters, Arvie. They're human beings, just like you. What are you afraid of? It's human nature to desire and engage in social contact! Deep down inside, you love that shit. You just gotta find it.
Allow me to write an obnoxious, woody allen-like wall of text that might be gibberish. people can feel free to not read, but this is just my take as someone who is on both sides of the coin...
We are monster-ish, though, if we're not close pals or in some other kind of set up that makes it easy to empathize. We get more fair-weather with the more distance we have from knowing a person. If they are distant from you, but you know you'll never see them again, you might be nice as hell because there's little risk (like when you meet strangers on vacation and become insta-best friends.) Or just the opposite. When we have our confidence, we look down on those without it, usually. or we just don't want it to become our problem. I catch myself doing this a lot, now that I've gotten over a lot of anxiety. If I'm feeling good at a party and having a good time, but someone is sitting in a corner moping, I usually don't reach out. Then someone will point it out and everyone's like "yeah, that's weiiiiirrrddd" and whatever, everyone agrees because we're all drunk and unified. If people know this person is consistently "weird," they'll inevitably talk some shit and you can tell they've just cherry-picked some ways to "other" this person, which is a really terrible thing that we all do, it's like punishment for them not being outgoing enough which pushes them back further. Very backwards. Or I'll have talked to that person at the beginning of the night before the party got going, since introverts attract introverts. I'll then get into the mood of the party and if they seem like they're not blending in and are kind of clinging to me, I get evasive in a hurry. What they're doing is totally understandable, it's just that I don't feel any responsibility to get them up to par or something and it can really feel overbearing or potentially cock block you on accident.
But before and still on occasion today, if I sit there quietly and someone points it out in anything less than a normal/neutral way and if I'm not totally ready, I feel put on the spot and bam, nervousness suddenly jumps up like crazy, sometimes making me say something odd or just not reacting naturally. And if people just kind of stop talking to me after that, I'll have no idea why and get more anxious, even if it's just because the conversation kept going on and their not talking to me wasn't about anything I did. But If I'm sitting there quietly and nobody reaches out, then I feel like I've alienated myself and every minute that passes, it'll get weirder if I suddenly speak up. And there's always a person who is really bothered by your presence who gives you dirty looks, which makes you feel like they've made some terrible pre-judgment (they usually think you're judging them...but everyone is judging everyone all the time, so wtf.) I usually can't adjust my attitude for a given situation and feel like people either have a lot more mental stability all the time (not true) or that they can just adapt to a social situation better (true.) But if I'm happy and the mood is sad, I get frustrated. If it's vice versa, then I usually just want to peace out so I don't bring down the atmosphere--which is like the weirdest thing you can do, but sometimes it's unbearable to be there any longer! The whole thing is one big knot.
It's gotten a lot better over the years, but my teens and early 20s were the worst. I still can't do the superficial networking kinds of social situations though, so I have to blaze my own way for a career or just find something less high pressure with a higher concentration of introverts, like the librarian program i'm going into. or porn stories that i can just publish online anonymously
A few things helped me and maybe they'll help Arvie. Part of my anxiety was because it seemed like other, more social people had it made. I had to really drill it in my head that all people have some kind of serious issues, often much worse than just being anxious. They might appear perfect in social situations, but if you pay attention, you can always see the cracks. It's part of being a monster-ish human, I had to find ways to equalize myself with others, so I can be like "yeah, I'm quiet, but they're X, which probably drives them nuts when they're not having fun at parties. And if I can see it, then they are probably dwelling on it a lot." Of course, some people just seem to have no idea what their flaws are. But when they get drunk or stoned, they'll open up to you and reveal that yes, they are aware of how they act or whatever. and they open up because you're an introvert and though they may have seemed like dicks before, they secretly think you have mysterious, all-seeing, all-knowing powers because you don't talk as much...i've been in this situation so many times

Those conversations were really important though...it helped me separate the face people put on in social situations vs. what they're thinking. So, seeing that everyone is more or less on common ground in one way or another leads to embracing the mentality that we're all human, so we're all kinda fucked up, so lets have fun or do whatever we got together to do.
And the other thing that helped is what everyone else says, rightfully so-- just going out to social engagements that I didn't want to go to, over and over. Watching what people do, looking for the ques, pissing people off on occasion, being the life of the party on occasion...it's all super gradual. People who are comfortable with these situations will say "just do X and it'll all be better" but the reality is that us anxious introverted types have to work our asses off to do these things, so throwing yourself into them is the only practical thing you can do, unless you really need meds or something. You'll fuck up, maybe get ostracized from one group or another. Then eventually you get used to it and start getting girls to go home with you, which will help you rally/build up momentum for these kinds of situations. But if I lapse, I have to build that shit back up again, which sucks.
the end
(c)2013 Don Flamenco
TL;DR - go to the dinner and be awkward. You don't even have to do anything there. Nobody will call up anyone and be like "I see Arvie has this award, but how was he at the dinner?" I know that doesn't help, but it's the best practical advice you'll get that's easily applicable.