Severus Snape definitely was not a huggable person, he was not someone who went around hugging people either but Lily brought all kinds of hidden feelings and personality trades out of him. He returned the hug warmly and for a moment wished that he would dare to do more then hug her. He was so close he could kiss Lily, but he didn't, things were confusing enough as the were at the moment.
"Just tell me what you want to do, we can go home or we can stay." He didn't let go of Lily yet. He remembered that she loved to dance. The dancing he taught her might be out of place at this party but he would even dance with her if that is what she wanted.