Surely not everybody was Kung Foo fighting, were they?

Yes, dance with me.  :  )

Nope.  They were Kung Phu fighting.  Billions of us.  You should have seen it.

have no idea, i wasnt there

It's complete nonsense, like most songs. 

  Oh, I'm quite certain that they were, or else the song would not have led us to believe so:

Everybody was kung-fu fighting
Those kicks were fast as lightning
In fact, it was a little bit frightening
But they fought with expert timing
They were funky China men from funky Chinatown
They were chopping them up and they were chopping them down
It's an ancient Chinese art and everybody knew their part
From a feint into a slip, and kicking from the hip
Everybody was kung-fu fighting
Those kicks were fast as lightning
In fact it was a little bit frightening
But they fought with expert timing
There was funky Billy Chin and little Sammy Chung
He said, "Here comes the big boss, let's get it on"
We took a bow and made a stand, started swinging with the hand
The sudden motion made me skip now we're into a brand knew trip
Everybody was kung-fu fighting
Those kicks were fast as lightning
In fact it was a little bit frightening
But they did it with expert timing
Keep on, keep on, keep on, keep on
Everybody was kung-fu fighting
Those kicks were fast as lightning
In fact it was a little bit frightening
Make sure you have expert timing
Kung-fu fighting, had to be fast as lightning
Keep on, keep on, keep on
~

What else would the Foo Fighters do?