I researched through the night and came to the conclusion that I wanted to see a pediatric urologist for another opinion.  Doug and I talked it over this morning, and is completely supportive, as I knew he would be.

This has been an interesting experience so far.  Because of his age, I felt it was necessary to explain to him that no one should touch his genitals unless it was a doctor with mama and/or dada present, or unless it was his mama and dada.  I also told him that I was checking because "the doctor thinks you might need surgery and mama needs to make sure he is right.  I don't want you to have surgery unless it is necessary.  Is that okay?"

"Yes, it's okay, mama."  My little guy!

So there you have it.  The rest of this post is detailed medical stuff from my research in case any other mamas find themselves in my situation.  While surgery still seems likely, I feel more informed than I did 24 hours ago.   

I found this page from American Family Physician® journal article which has a lot of information, a dx chart and pictures of physical palpitation as well as of the surgery

http://www.aafp.org/afp/20001101/2037.html

Undescended testicles can be categorized on the basis of physical and operative findings: (1) true undescended testicles (including intra-abdominal, peeping at the internal ring and canalicular testes), which exist along the normal path of descent and have a normally inserted gubernaculum; (2) ectopic testicles, which have an abnormal gubernacular insertion; and (3) retractile testicles, which are not truly undescended. The most important category to distinguish on physical examination is the retractile testis, because no hormone or surgical therapy is required for this condition.

It further talks about the actual physical palpitation with photos…

A true undescended or ectopic inguinal testicle will be felt to "pop" under the examiner's fingers during this maneuver. A low ectopic or retractile testicle will be felt by the opposite hand as it is "milked" into the scrotum. The ectopic testicle will immediately spring out of the scrotum when it is released. The retractile testicle will remain momentarily in the scrotum until further stimulation causes a cremasteric reflex.

Differentiation of a retractile testis from a true undescended testis is sometimes difficult; consultation with a urologist may be valuable.

I believe now that he may have an ectopic testicles,  since the testicles do not stay descended momentarily.  While this would still require surgery, I would just like to get confirmation from someone who is not a surgeon. 

After looking further into the hormonal treatment, because of his age and the fact that this is most likely ectopic testicles which are physically unable to stay down, this course does not seem likely to succeed.