I was wondering was your AM studio pressure you into some package deals? I went to a private studio which had an instructor who worked there before coming to the independent studio. He was told to push some sales onto some of his students if he did not than they would have an instructor who would. He has since moved on that studio I went to, so I cannot say where is now. Anyway, I get the impression from independent studios dance parties are usually goes half for the school and the other half go to the instructors sponsoring the party. At least the Friday's and Saturday's group lesson is a little bit better since the party is included with the lesson. Some do make a pot luck instead of the group lesson. At least the earlier studio that I hinted at, they do have one free lesson on Saturday mornings and had(or have) a door prize which was a free pass to an upcoming party.
My first independent school which also the only one that I took lessons from, they had their weekly beginners group lessons were free for paid students. The studio has now at least switched hands over the years and now part of different studio management. They did not offer a free pass to another lesson, but they did do a 50/50 raffle which at that time the parents owner when he won the pot. He would split his share with another person, so they picked a second winner.