Hi Terry from another fellow "Terry"!
What a great time to come to Disney! December is a terrific month to visit, plus it's double the fun when you visit Disney right before Christmas and then celebrate Christmas at home with family. It's almost like celebrating Christmas twice! :-)
Yes, attending Disney's Very Merry Christmas Party does require a separate ticket. If you've never attended before, and can fit it in your budget, it's certainly an experience unlike any other. This is one of Disney's signature events, and certainly captures the spirit of Christmas. From the parade, to the Christmas stories, to snow falling, to cookies and cocoa, it will certainly make you feel like you're "Walking in a Winter Wonderland!" For more details, click here.
The only other event I can think of is the Candlelight Processional in Epcot. This also requires a separate ticket, and is also a great experience. You can enjoy a Christmas story narrated by a celebrity, with a full choir, orchestra, you name it! For more details on this, click here.
So, enjoy your visit, take in as much of the sight and sounds, and have a great Holiday season!