The Washington Ballet is moving up in the world, though there were times in the past week when it wasn't easy to tell up from down, or both from sideways.

The company, in tandem with a fairly glittering slew of international guest stars, was accorded the honor of opening the Fifth Annual Palm Beach Festival of the Performing Arts this past Tuesday night, as part of a three-evening Celebration of Dance. Among the guest artists were such luminaries as Anthony Dowell and Antoinette Sibley of Britain's Royal Ballet, Peter Martins (just named "ballet master in chief") and Heather Watts of the New York City Ballet, Marianna Tcherkassky (a Washington Ballet alumnus) and Danilo Radojevic of American Ballet Theatre, Broadway and film star Ann Reinking, and others from the Joffrey Ballet, the London Festival Ballet, the Metropolitan Opera Ballet and elsewhere.

The artistic step forward for the Washington Ballet was the company's appearance, not just on the same stage, but in the case of Tuesday night's performance of Sir Frederick Ashton's "Facade," in the same ballet with artists of the stature of Dowell and Sibley. It marked a further advance in a march toward maturity that began in 1976 with the reformulation of the troupe and the engaging of resident choreographer Choo San Goh, and has gone on to include world-class honors for such dancers as Amanda McKerrow (now with ABT) and Bonnie Moore; the commissioning by Mikhail Baryshnikov of Goh's "Configurations" and the former's guest appearance with the Washington Ballet; and an expansion of the group's touring scope to embrace not just the entire Eastern seaboard (including New York City), but Europe and Asia as well.

But if the dancers drew unquestionable benefits from working alongside Dowell and Sibley, as well as from the challenge of the stylistic parlor tricks in "Facade," as a whole the troupe was rather lost in the dithery shuffle of the festival's opening programs. On top of which, the company fell victim to the Palm Beach social pastime of snubbing--it's a place where ruling castes sometimes reassure themselves of their high place on the ladder of privilege by looking down. Following the gala benefit on the festival's second night, there was a formal supper dance at the Breakers Hotel, a celebrated monument to Palm Beach opulence. Though the guest stars were there, and even the press, and though Washington Ballet founder-artistic director Mary Day and assistant director Goh were asked to come, the Washington Ballet dancers remained uninvited. Goh declined to attend without them.

At first blush, Palm Beach might seem an odd location for an annual three-week performing arts festival, unless one takes into account the historic alliance between luxury and cultural ostentation, and recalls, too, that the founder magnates of Palm Beach set out to establish a kind of American Monte Carlo. The tone of the place appears to be set by celebrities and the monied upper crust who built and inhabit the rows of palazzi along the long narrow ribbon of white beach. Indicative, too, are such temples of indulgence as the Breakers and the ritzy shopping street, Worth Avenue. (Was ever a boulevard more aptly named?)

But amid all this there has persisted a hard core of affluent culture vultures who have given the city museums, a theater, an opera season, concerts and, starting in 1978, a burgeoning performing arts festival. In 1978, the festival consisted of four performances by the New York City Ballet, and a total budget of $200,000. By this year, the budget had grown to $1.3 million, and the attractions included, beside the Washington Ballet, the Alvin Ailey and Jose Limon dance companies, and Chicago's Hubbard Street Dance Company, as well as high-level symphonic, chamber and jazz concerts, theater groups, puppetry, mime, lectures and other assorted items. It's been a booming operation that has consistently managed to break even and as recently as two years ago, was showing a treasury surplus. This year the recessionary pinch has caught up with the festival, which is projecting a deficit (on the order of $100,000) for the first time; even so, local enthusiasm and momentum remain at a high pitch.

The festival utilizes a number of performing facilities, but for both seating capacity and economic reasons it's constrained for its largest attractions--like the Celebration of Dance--to rely on the 15-year-old, 2,000-seat West Palm Beach Civic Auditorium, which looks like a cross between a remodeled airplane hangar and a circus tent, and in fact has housed everything from elephants and wrestlers to prima donnas. It's one of several disadvantages the Washington Ballet and guest artists had to contend with last week, along with a distinctly second-rate orchestra and lighting of substandard quality.

The main trouble with the Celebration of Dance, however, was the severe incongruity of its components. Tuesday's program was billed as a "tribute to Frederick Ashton," and it included one complete ballet--the quirkily whimsical "Facade" of 1931--by the 78-year-old master choreographer, as well as four pas de deux, among them "Soupirs," to Edward Elgar's music, which had never been seen in this country. The program opened, however, with the Washington Ballet in Goh's placidly devotional ballet to the music of Verdi, "Due Pezzi Sacri," and despite a fluent performance with Janet Shibata and John Goding as the distinguished leads, it just seemed way out of key with the Ashton. The major gratification of the evening was seeing Sibley and Dowell--dancers who have attained a state of highest artistic grace--in the touching "Soupirs," the magical Oberon-Titania duet from "Dream," and the deliciously sly cartooning of "Tango" in "Facade."

On Wednesday night, Goh's complex, dynamic but flawed abstraction, "Scenic Invitations," set to fugues by Mozart and Beethoven, seemed even more at odds with the remainder of the evening's fare--a chain of unrelated, showy pas de deux. These ranged from pieces by Ashton and Balanchine and excerpts from such classics as "Giselle," "Coppelia" and "Le Corsaire" to snappy kitsch in the Broadway manner as exemplified by a solo for Gary Chryst from Bob Fosse's "Dancin'" and a mediocre, Astaire-style number to Gershwin danced by Dowell and Ann Reinking. Once again, the rewards came from individual performances of distinction, mainly those by Dowell and Sibley, Martins and Watts, Tcherkassky and Radojevic. As for the rest, it had the blandness that comes of trying to please too many palates at once.

On balance, the experience appears to have been predominantly a profitable one--artistically speaking--for the Washington Ballet. Against the background of stars of the first magnitude, and splendid but unfamiliar choreography ("Facade") of exceptional difficulty, the company revealed some shortcomings, in the way of inexperience and lack of talent-in-depth. The dancers also proved they could hold their own in exalted surroundings, and rise to the crises of instant adaptation.