Hi, Zardo. First, I am so sorry for what you are going through right now. It is not a pleasant position to be in, and you have my complete sympathy and support. Having been pretty much where you are, I would like to share a few thoughts based on your post, if that's OK (and I'm not totally familiar with the entire backstory, but think I've got it pieced together a bit.)
1. First, embrace ANY support anyone is willing to give you. It's absolutely FABULOUS that the justice system can even order such a thing as dual-diagnosis treatment. In our state, that is no longer even an option. Actually, the juvenile justice system here cannot order either inpatient mental health or inpatient substance abuse treatment as a condition for probation. Or even as an alternative. So if you have this resource available to you, explore it. As to your question of who will pay for this...well, that probably depends on the laws of your state. In my state, the parents are responsible for all costs of anything ordered by the court. Including a court-appointed attorney, outpatient treatment/evaluations, etc.
2. Probably the larger issue here in your mind is your question about what the appropriate approach would be. You feel conflicted because your difficult child is telling you one thing, then contradicting that, then your subsequent insight into his phone messages tell you something else yet again. (((((hug))))) I understand. I do. You want your son to be ready for treatment. You want him to give up his abuse of substances and his distorted thinking of being able to "just" smoke pot or "just" do this or that. We, the sober people of the world, know this is impossible for an addict. And yes, I don't care what the "experts" or society says, an addict can be addicted to pot. Perhaps they won't die from a withdrawal, but a psychological addiction is still an addiction. My son has spoken almost identical words to those your difficult child has spoken. And I know in my heart when it's real and I know in my heart when it's not. I'm willing to bet you do too, just based on your statement "this doesn't feel the same". If he's worried about his friends forgetting him and he wants to have contact with them, he's not committed to his sobriety. If rehab away from home is a viable option, I would seriously consider it as the only option if I were in your situation. If he attends alternative school, I assume this means he'd have access to his same crowd and old contacts. You asked the question about just letting things take their course. You asked what does this mean? (((another hug))) I have said that same thing SOOOO many times!!! Oh my gosh! The years of struggling with that stupid phrase (and the oh-so-helpful "let go and let God." WTHeck does that mean?!?!?!!? Is God supposed to set the curfews? Is God supposed to enforce the rules and dole out appropriate discipline? Argh!) Anyway, as far as hiring an SE consultant to represent his interests at the board of ed expulsion/manifestation determination, it sounds like you are already somewhat familiar with what they'd be seeking and that would be to get him out of his environment long-term. Again, you are back to question of whether you feel this is the best option. As far as people telling you that sending them away doesn't work and they have to come back eventually...well, there is some truth to that statement. However, leaving them in their current environment doesn't work either. An addict can be an addict in pretty much any environment and it ALWAYS comes down to their choosing to stay sober. The up side to him going into long-term treatment is that there is the possibility that it would work and it gets the drugs out of your home and away from your easy child. And it may possibly give you the breathing space to do some healing. Because you are in the thick of the battle with two long years looming ahead until he's 18 and pretty much in control of his own destiny (if your signature is current and he is 16). You will need your strength. You will need firm resolve. You will need support (and I mean from people who know. Not from people who think they know). And none of that is easy to attain while you are still spending every waking moment monitoring his movements and planning your next defensive or offensive movements.
3. Your question about IEPs in Department of Juvenile Justice - my son had an IEP for his ADHD and the Department of Juvenile Justice pretty much came up with their own version. Depending on the type of facility (and probably again your state), there may not be too much need for an official IEP, although he can maintain the "status" in the event he attends college or returns to a regular classroom someday. The environment in the facility where my son was sent was already outside of a typical classroom environment, so the IEP developed for him in a regular high school was irrelevant. They developed their own plan and put it into play in his education. Because my son turned 17 while he was in Department of Juvenile Justice custody, he was required to obtain his GED rather than continue pursuing a regular diploma (again, this is a state-specific requirement). This was just as well in my son's case, as he never would have been able to return to a regular high school environment to pursue a diploma, and he was at least able to be accepted to a community college with the GED. Otherwise, he would have nothing at this point. Hopefully you have some resources either through the legal channels or your community that can tell you what your state requires/implements as far as an IEP and so forth. I wish I could point you to a specific resource, but unfortunately in my experience, there were none.
Good luck to you as you move forward. Try to listen to your instincts and let the rest kind of filter through. It's a safe bet you are bombarded with "advice" from well-meaning friends and relatives. There can be helpful information found from almost any source. If it lines up with your beliefs and your gut, then it's good. If it feels wrong, well, it probably is. You must do what is right for you and your family, and that is totally you and your husband's decision to make.
Take care,
Petunia