I was always under the assumption that the rehearsal dinner involved those in the rehearsal plus those closest to you (parents, grandparents, etc.). I was told by a friend the other day that a rehearsal dinner should also include everyone coming in from out of town - which, since my FI and my families live in Ohio (we live in CO), means that I need to invite everyone?
I don't want to exclude anyone, but I also can't really afford to have what would amount to 2 receptions. Where is it proper to draw the line in a rehearsal dinner?