WRAPUP 8-Russia warns will respond to "aggression"

* Russia: we can deploy sanctions but prefer not to

* Britain's Brown demands review of EU-Russia ties

* Germany says Russia should not be isolated

* U.S. diplomat urges EU to support Georgia

* Georgia seeks "smart" sanctions, monitors and aid

By Christian Lowe

MOSCOW, Aug 31 (Reuters) - Russia does not want confrontation with the West but will hit back if attacked, Kremlin leader Dmitry Medvedev said on Sunday, a day before EU leaders meet to draft a response to Moscow's actions in Georgia.

British Prime Minister Gordon Brown said he would press fellow European Union leaders to review ties with Russia in retaliation for Moscow's decision to send troops to Georgia and recognise two Georgian breakaway regions.