Dropped beetles disappear in roughly 3-4 minutes. Since it can take a minute or two just to pick them all up, it would be wise not to drop any you're afraid to lose. Keep a few extras on hand as well.
One method that works well is to place your 21 beetles in a chest next to the altar. When you are ready to do the festival, simply tear down the chest. This releases all the beetles at once, without your having to drop them one by one from your inventory.
(Historical note: The festival originally required a 15 percent alcohol. Upon the realization that this was currently impossible, Teppy awarded everyone in Egypt 24 hours of waypoint time and reduced the requirement to 12 percent.)
(See also: tests, The Test of Festivals, Festival Player Progress, Festival Schedule, Festival Needs and Determining Festival Requirements, wine inventory)