Well, really, as the hosts, you can invite or not invite whoever you please. I know in some communities there is an underlying assumption that all out of town guests should be invited to the rehearsal dinner, but I've never been able to understand that. Personally, as a non-related out of town guest, as much as I cared for the happy couple I would not feel the need to spend every possible moment of my visit to their town with them. After all, I assume they're adults you've invited, so presumably they have travelled and can find a restaurant in a strange town (or ask you for recommendations).
I don't think that an invitation to the rehearsal dinner should be regarded as a required payback for the "trouble" of travelling to the wedding venue. If travelling was that big a problem, the guests could decline with thanks and grace.
Just my opinion.

In our community, all the out of town guests are invited to all the events of the weekend, including the rehearsal dinner (or whatever there is the evening before). But although 2 1/2 hours is a long drive, I wouldn't say that makes all your guests out of town visitors. The point of including the out of towners is to provide for the feeding and entertainment of people who have gone to the trouble and expense to come a long distance to your event, rather than leaving them sitting in hotel rooms while you are at a party to which they are not invited. This is not so important for people who have family and friends of their own in your town, but it is a nice thing to do for others. Anyway, if I understand you correctly, you are talking about people who are not going to have to travel overnight, just those who have a long drive to the wedding, right? In that case, I certainly don't think you need to invite them to the rehearsal dinner, even if your community's custom for out-of-towners is like mine.

I like the "closest circle" idea--the folks who ALREADY have to come to the rehearsal (wedding-party members), and the IMMEDIATE familiy of bride and groom (parents, sisters, brothers).

It's nice, of course, to have others who would otherwise be sitting in hotel rooms, but that robs the wedding party (presumably the B&G's most intimate circle) of the intimate party.

It's not rude to not invite people to a party, even if they know about it, and even if they don't have specific plans.

(And, I kind of like having that time w/ aunts, uncles, cousins, instead of 'making nice' w/ the bride's girlfriends whom I don't know)

My cousin invited us to join them for drinks AFTER the rehearsal dinner--it was nice. But totally not necessary, and actually a bit more fuss than was necessary. The BEST part of that evening was us cousins and aunts and uncles going out to dinner with EACH OTHER.

For our wedding, we invited EVERYBODY from out of town, but then, everybody who attended WAS from way out of town, and it made for a nice "getting to know everyone" barbecue. Since we could mill around, and chat in the twilight, it was nice.

I don't think it would have been as fun and enriching if we'd all been trapped at long restaurant tables.

I say, keep it small. If you WANT to extend it to out-of-town guests, only include people who would otherwise be in their hotel rooms.

If you want to skip them, you could ask the "coolest" of the aunts to host an alternate event that evening, time for the other folks to spend together.

In my mind, you invite the wedding participants (no dates), any parents of under the age of 16 wedding party participants, grandparents, parents and siblings. That's it.

I once went to rehearsal dinner where almost the whole wedding guest list was there... what was the point of now having the wedding... they could have just signed the documents then and gone home. (wink)