I would definitely pursue a grade skip. I understand your thoughts about the kids and parents in the next grade up, but you aren't doing this for them, you are doing it for you son. If things have gotten to the point of your child asking for a grade skip, then things are probably getting really frustrating for him and he is getting to the point of shutting down,when it comes to schooling. When our DD10 was 8 she too requested a grade skip and was devastated when the school said no. She then became adamant that she was not going back to school if she couldn't get a grade skip. She even started "dumbing" herself down at school because she was tired of listening to the other kids say "huh, what are you talking about?"
I heard somewhere that if you do not get a gifted kid in the correct educational situation by 3rd grade, which is age 8 for most places, you will lose them. This was definitely starting to happen with ours. I would think about this from the angle of what will your son gain from this skip rather than what are the other people like in the new grade.
However, beware, one grade skip may not be enough. Yes, the material will be more challenging than where he would have been, but it is often the pace of the instruction rather than the actual material that is the real problem. Our DD ended up with a 3 year skip and soon found out that even as an 8 almost 9 year old 6th grader, the classes still were not enough for her. It was a real eye opener for both everyone involved in the skip.
Good luck
