Sorry about the diagnosis, but once you get the hang of it, diabetes is really not so difficult to treat. My cat has been diabetic for over 10 years, and he celebrated his 20th birthday in May.
Do you know what range your cat's blood glucose levels tend to run? Have you considered testing his bg at home yourself, with a human glucometer? That would give you the most accurate picture of how he's doing, and it's a vital tool for getting a handle on this condition. Most cats really do need to go on insulin for at least a little while, until their pancreas can heal enough to start doing more of the work. Starting with a low dose of a long acting insulin (Lantus or Levemir) along with the low-carb diet, tends to really help. A diet change alone often just isn't enough, and the sooner you start insulin, the better chance the cat has of going into remission. I totally understand that the thought of giving shots twice a day, every day, might seem scary at first. It really does get easy, I promise! Most cats don't mind, it's just the clumsy human that has to get over it.
Some great websites with a ton of info for you to check out: