This is so very normal. If you want to be a good dancer, you do have to at times step out of your comfort zone. Be aware that it really doesn't matter what level you are dancing, everyone feels the need to find improvement. I have dancers who have been with me for 6 years and they still feel like they are awkward with the advanced material at the social parties...but they still attend!
I know it might feel like everyone is watching you, but the truth is everyone feels that way. The only difference between you and the other dancers is that the other dancers have decided to throw caution to the wind and improve their dance skills by dancing at the parties reguardless. You will always be your worst critic,it is human nature to do so. However,if you stay and plow through it,in a few months the new beginners will be watching you in wistful admiration as you are doing now. I promise.