Rhiannin, I know exactly how you feel. It is really annoying when you hear that one child is having a party but invites are not reciprocated.
I think you are doing the right thing in inviting this child. As SueW says, budgets and other practical matters could mean the boy's 'party' is a really small affair. Children's definitions of a party can be dodgy as well. It might just be a special tea with one or two friends.
Around here, as children get older, big parties - even parties at all - are getting far fewer. Lots of over 6 year olds get taken on a special outing with a few friends only. So my son is getting less party invites the older he is.
However, I think if you accept a party invite from another child's family, it is only polite to tell them what's happening partywise when it's your child's birthday. Even if a bit of fudging of the issue is involved, you should tell them if the party is just a tea for close family, or you are taking your child for a day out instead. You can always invite their child round for tea sometime. I keep track of parties my son has been invited to, so I can reciprocate if and when we have a party.
It does irk me that every time my son has changed school, the party invites tend to stop, even though the parents know we are only a short drive away and my son would love to see his old school friends. A case of being out of sight, out of mind, I think.
I am sorry your son did not get his invite or a polite explanation Rhainnon. I too would feel irritated about this. After all, in the end he is your son's friend. You and his mother having a run-in shouldn't really come into it.
I hope you have a lovely party and happy birthday to your son.