Dane - who was a member of 90s boyband Another Level - was DJing at a an event at the resort in Bognor Regis before getting involved in the brawl.
A video clip filmed by a reveller at the event (above) appears to show the 33-year-old star being led away in handcuffs by two police officers.
His brother, Wade, was also arrested and charged with assault and possession of cocaine. Their friend, builder Terry Kean was held for using threatening words and possession of cocaine.
All three were bailed to appear before Worthing magistrates next month.
Dane - who came second to Alex Reid on Celebrity Big Brother in 2010 - dated Katie Price between 1998 and 2000. The pair didn't speak for many years following their split but recently rekindled their friendship to record music for the glamour model's album.
Dane's old band, Another Level, are just one of the groups we'd like to see on the second series of The Big Reunion...