I have seen that phrase on MN several times since I started lurking around on here, despite never having heard it in real life. But from context and similarity, I guess it means the same as "itchy chin" which we used to say as kids to mean "yeah, right". I'd be willing to bet the accompanying hand gesture was the same too!
It got me thinking cos I'm a loser about other (possibly regional?) differences in sayings or games. One example I always remember cropping up when we were kids is the hide & seek game known either as 40-40 or 50-50 (obviously the 50-50-ers were just wrong..)
I find this kind of thing fascinating and would therefore like to open the MN floor to other examples....anyone?