A divorce ends the relationship with the exception of dealing with co-parenting. I suggest the bil is being unreasonable but yet your husband feels he has to be loyal to him. I see it as emotional blackmail.
You and your husband have a relationship with her and her fiance. That should be separate from your relationship with husband's brother. The brother severed the relationship and now needs to accept that not everyone else did.
I suggest that if your husband doesn't go to the wedding in deference to his brother he is harming his relationship with her and her family and you. The brother is forcing him to choose and in my book that always means I don't choose you. I am independent and make my own decisions based on my values and not yours. If this is a deal breaker for you that's your problem.
I suggest that the brother may be upset and put on pressure but he'll cool off and it'll be over. However, if he doesn't go to the wedding I suggest he is putting a big hurdle in that relationship.
By not going your husband is giving in to his brother's bullying. By going to the wedding he is supporting his friends which has nothing to say about his relationship with his brother. His brother is divorced. The relationship is over. Not going does not support the brother because the brother has nothing to support. (I'm having trouble putting this into words).
Going to the wedding supports this new relationship. It's a positive act. Not going is a negative act and only supports the brother's unreasonableness.
It can be looked at as a boundary thing too. His brother is trying to control his friendships when your husband has every right to have whatever friends he wants.