I thought you might find this article helpful:
http://www.slate.com/articles/.....ies.2.html
No, I don't think you are over-reacting at all. I think you and your son are in a situation with a social bully where it is very easy to be confused by manipulative and clever social tactics, that would make anyone anxious. Bully A's group seems like the sophisticated bullying of a middle school school girl group's social bullying - and not knowing boys, I think that's remarkable. It's actually hard to see how the troublemaker at the center, stirs up trouble and the bystanders who join in become deputies in bullying.
Educating yourself about the social roles the bullies, bystanders, victims, fools and upstanders can play, will help you make sense of this, clarify your thinking and responses and stay one step ahead of the bully and his circle. My daughter and I found the role descriptions in "Queen Bee and Wanabees" helpful. There is probably something more targeted to 8 year old boys but look for something that is targeted to 'social bullying' which is more sophisticated than straight forward bullying.
Suz's comments about 'shutting out' are on target. If you son had actually kicked or hurt one of the other kids he would be playing the part of the fool. The fool gets disciplined by the teachers, not the clever troublemaker and his deputies. Good for your son to see through that. What the trouble-makers group was offering was potential entry into the group, but it also sounds like they were looking for a fool to create trouble for them and then they might - or might not - drop him fast. Good for your son to see through that, but now he might be or already is a target, too. No deputy wants to risk loosing his place in the pack, by being an upstander. Because this is a social group (like a pack of dogs) I think it will be helpful to enlist the intervention of the teacher, principal and maybe the school community.
So I would suggest reading and researching and trying to evaluate how knowledgable your teacher, principal and school is about bullying and looking into bringing this knowledge to their attention if needed.
Maybe your teachers and principal have had excellent training but some adults haven't and don't fully see the bullying that is in front of them and if they do, they are confounded by not having effective ways to deal with it.
When you talk with the teacher, administration etc, you'll have to evaluate:
'Does this person get it?', and if they do, 'Do they know what to do about it". ...
"... effective programs to deal with bullying have appeared only relatively recently. " * They did not exist when I grew up and are only now becoming part of our cultural knowledge. Understanding, stategies, books and programs on the topic are now available. There are programs offered to schools if your school hasn't yet had training. Maybe Izzy's husband on the Council would help drive that if needed.
* I thought you might find this article helpful:
http://www.slate.com/articles/.....ies.2.html
Other books to look at "The Bully, the Bullied and the Bystanders" by Barbara Coloroso or something by Brazzleton - but I don't know if they're directed toward young boys. Oh, I second Suz's suggestion to read with your son books for kids about bullying. We also found that helpful.
Please let us know how it goes for you. Good luck.