Weird experience...sexual triggers.

Hi, I have a long time friend on facebook, great looking guy, within an hours drive. I told him ages back that I was atttacted to him, at which point he told me he was in a relationship. That was it for me, the sisterhood before men. Anyway, we've remained friends, we try to outflirt each other, in public, just silly banter. I've become friends with her, she and others even join in the silliness sometimes. At one time I thought maybe they weren't serious, or that they had an open relationship, well, I asked, he said he was committed, they even moved in together. I hadn't spoken to him in a long time and a couple of weeks ago we talked about going out for our birthdays. To be honest, I don't want to, I suffer from social anxiety, among other issues, but I felt awkward and well, I have to start socialising at some point, so I agreed. More banter followed, but this time it felt weird, like he was jokingly testing me to see if I was willing to take part in a threesome. PM'd him and sure enough, he wants a threesome. I told him that I was hetero so it wouldn't work out but I didn't think less of him for it. The dinner is still on, though I still don't really want to go. I really don't think less of him for it, but I am terrified of sex or sexual encounters...talking about it, ok, but when physical opportunities occur, I freeze. I'm a five year old and the man is tricking me again. On one level, I am accepting and very adult about this, but on another, I'm a kid and about to put myself in danger. It's hillarious, sickening and terrifying at the same time. I have a uni paper to write and I can't focus, keep switching alters.