Alanabit,

Willie and the Hand Jive was originally written and performed by Johnny Otis, a pseudonym for Greek American John Veliotes, who was kind of an activist for African-American causes. He was a jazz bandleader, jump blues pioneer, early rock recording artist, radio and TV personality in LA, and Shuggie Otis's dad.

I think it was unlikely he was thinking about masturbation in this particular song. I believe it was recorded in response to "Bo Diddley," in which Bo took a common Black folk song, "Hambone," rewrote it slightly, and took its characteristic hand-slapping rhythms to become the "Bo Diddley Beat." "Hand Jive" was another name for this "hambone" hand-dance. What Otis was saying was "Bo didn't invent this beat." Other groups like Kip Tyler and the Flips recorded songs that featured the same rhythm in the African jungle, again making the point that it was common cultural property at least of the Black community.

The song itself is pretty clearly about a dance, as it has men and women doing it together, grandma paying to watch "baby sister" do it, a child doing it on TV, etc. That's not to say you can't interpret it to be masturbation, but it becomes a pretty gross, depraved and shocking song that way (especially the grandma part).

Mind you, years later Otis recorded an X-rated album called "Snatch and the Poontangs," so he wasn't above this sort of thing!