Forget the negatives!
There are plenty of places that don't have the compulsory New Year dinner and as Andy says, some have it and it is not compulsory anyway. We stayed at the Mercure one year - they had one but it was not compulsory.
If you have the slightest chance to get to Patong Beach on New Year - do it !!
The whole place will be in party mode - everyone happy, no aggression. There will be food, drink and other stalls and free entertainment right along the beach front but the main attraction will be the fireworks - which go on for hours.
Fireworks and lanterns are sold in the streets and it will most likely be the most spectacular firework display you will see anywhere.
Go to YouTube and enter "2012 New Year Fireworks Patong Beach" - and you will see what I mean.
We have been at Patong the last 2 new years and you won't keep us away this year.
Get on to those bookings, AtwaterJay and Camo - and don't spend your time in a hotel at some boring dinner ! There's too much to miss.
Self-appointed, unofficial and unpaid advocate for New Year at Patong Beach (!)