This is all just so foreign to me, since at my district, we are soooo customer-service oriented, to a fault. Then you have this, where it's the complete opposite. There has to be a happy medium somewhere along the way where there are rules for parents/kids/teachers to follow but it is recognized that everyone is human, things happen, and you work with people. The place where Josh goes to school is much like you describe, Nicole-- they would never put up with a parent questionning/confronting a teacher, which I think is wrong.
I was going to say, demand a switch, but honestly, you probably lost a lot of leverage after the mess at the beginning of the year (asking to have him switch, then saying no once they agreed to it.) I know why you decided the way you did, but it still gives them ammo to paint you as the "unappeasable parent."
I kinda knew last year when you said that they were saying the kids didn't "need" an IEP that it was going to be a problem. You need a child advocate. They are free-- and you need to bring one to the meeting. Your kids need to have 2 things-- so O/T and Aspbergers should do it for Milo. If you get him a written diagnosis, he should at least get an IEP under what's called OHI-- "Other, Health Impaired." At the very least, you should ask for a 504, which is where it's not an IEP per se, but it's a list of accomodations they have to provide just like an IEP.
I think in the end you are going to have to make it so miserable for these people that they just switch him to a new class. How is Milo doing in class? You haven't said much about him hating it or anything. If he is ok, yet not learning too much, he can be working on coping skills and other things-- it might be a good experience for him in the end to just be able to focus on social stuff. Neither is the optimal situation. I think Milo probably just needs you to act like it's "ok," even if you dont' think it is. Good luck.

I think Jeanne has some good points and sadly the not swapping of teachers after they granted the request probably hurt you more than anything. I do find it very odd that they refuse to do the IEP. Why are they so against it? I think in our school system kids with IEP's actually get the school more money so they are not against them at all maybe not for all the right reasons but times are tough and money is money.

I hope Milo is enjoying school even if you think it's not what he needs academically.