Ripple does have only a small number of server nodes today, but that should be growing over time. A node cannot freely set balances. Each node signs each ledger and any change to a ledger entry (such as a balance) must be accompanied by a signed transaction justifying that change or other nodes will reject it.
Nodes are in fact called "validators" and they validate each ledger to ensure that any changes are justified by transactions. They sign these ledgers every few seconds.
As for the peering needing to be centrally controlled, I assume you're referring to each node's set of validators. While that does need to be sanely managed, it doesn't need to be centrally controlled. A number of organizations can publish lists of validators they believe to be reliable. The algorithm is very tolerant of things like minimal overlap or bad apples. Every honest node wants to agree with every other honest node, and dishonesty is impossible to hide, so the problem is not that difficult.
(I'm one of the architects of the Ripple network.)