Casual sex with newly bi friend?

My best friend asked me if it would be awkward for us to "experiment", purely for the sake that she's bi-curious, and I'm bi. At first I didn't feel comfortable with the idea, only because I didn't know how our friendship would be affected. After a lot of reassuring I gave in.

Now she's come out as bisexual, (even though she's never been with a guy.) The problem is, it seems like she only wants to be bisexual with me. She won't tell anyone her sexuality, which I can understand because her family are a bunch of strong Catholics, and most of her friends are from her church. She claims our friendship is strong enough to have casual sex here and there.

I don't know if she just wants to have casual sex because she can't come out and get an actual girlfriend, or if it's because she likes me more than a friend, (I hope not.) She's really very sweet, and usually doesn't argue with what I say, but she's very insistent on us having a sexual relationship. I, on the other hand, want a romantic relationship, not a closet one, and not with my best friend.

I've royally F-cked up. How to I straighten this out without losing our friendship? Is our friendship beyond repair?