It could be that (1) the negative effects do not effect ASH vampires, thereby making the toast a ruse for Dagoth Endus to obtain an unfair advantage or (2) that the Nerevarine defeated Dagoth Endus BECAUSE he was drunk.
You forgot option 3 in your post, Word Merchant, and that is:
3) Dagoth Endus has him some class. Now all he needs is a monicle.
On topic, though, I'd imagine that vampires would be affected by alcohol. They're affected by poison and potions, right? And all three affect the body, be it healing/fortifying or hindering it (depending on the liquor, either one). So why not?
Besides, the idea of Janus Hassildor stumbling around, slurring his words with a lampshade on his head is priceless.