You should ask about checking labs for SSA & SSB (blood markers for Sjogren's). 40% of Sjogren's patient can have negative markers but should be checked. If positive though, it might save you the biopsy.

The lip biopsy isn't that bad. It's a small incision with local anesthesia. It can cause some very minor numbness in the area (which can be permanent). Do you have dry mouth and dry eyes? What about cavities (more then usual)? Any other unexplained symtpoms?

The SFN associated with Sjogren's is sometimes improved with IVIG, you should ask about this if the diagnosis is positive. One step at a time though. See if it's Sjogren's first.

Keep us posted.