What should I do when my sister's fiance hits on me?

My sisters fiance told me last night he wanted to have with me. (It's so creepy writing that) They've been together for 7 years and he's always been like a brother to me with a heart of gold. Everyone one just loves him and I've always been able to go to him for everything. I was totally caught of guard last night when I went over to their house to hang out. After my sister went to bed we stayed up talking which we've done several times in the past. Earlier I was talking both of them about a little problem I was having with my boyfriend. So he brought that up again and said "We should just go f*** in the woods" and laughs. I took it as an awkward joke. But he kept hinting at it until he just came out and said it. He said in two weeks on the 29th if you want to go through with it we can meet at a hotel and go for it. He wanted to give me two weeks to think about it. I was just so shocked because what made him so sure that I would even think about doing something like that? I didn't say anything that would make him think that. He knew I was frustrated with my boyfriend but geez! I still love him and I wasn't thinking about breaking up with him. I didn't know what to say after that. I was so creeped out and in shock. So I've just been trying to pretend it didn't happen. I couldn't wait to come home. I came through that door and gave my boyfriend a big hug. My problem we were having just melted away after what I experienced last night. I just don't know what to do. I'm totally not going to go through with it. Should I just continue to pretend it didn't happen? I want so badly to tell my boyfriend but I know it would just make him mad. I was trying so hard not to cry when I came home because I felt so violated. What should I do?