No you are not over reacting. I did not raise girls, I raised boys but if they had asked to do such a thing I would have said no as well. Now my boys have teen boys and they also would have said no. After explaining to your daughter in a kindly way, call the parents involved in the sleep over and explain to them in a kind way why you are saying no. Emphasize to them that your daughter does not have your permission to attend a mixed sleep over party. She may be angry, she may rebel, but she will also know you care enough to set limits and be involved in her life. It is a lesson she will carry with her into her own parenting. Indifference is far more devastating than rules and expectations.