There are lots of events held in Karuizawa during Christmas time. The most famous church in Karuizawa, Karuizawa Kogen Church, holds "Candle Night", which some 2,000 candles will be used. The town also will be lit with "illumination lights", in another word Christmas lights. Usually, Karuizawa gets covered by snow around Christmas time so you will be able to enjoy the dramatic and romantic view of the town of Karuizawa.
Plus, Karuizawa will be less crowded comparing to summer. There is a big outlet mall beside the station.
You will be able to enjoy Karuizawa without skiing for sure!