Aside from the alternate lyrics I composed above to change the (respectively) derogatory and nonsensical words, as an American I also remove the obviously British word "loo" when I sing the song (we Americans know what it means don't consider it derogatory, but we never use it). Instead, I sing:

Was that little green shed, our craperoo.

(Not that "craperoo" was a known American word either before now, as far as I know, but it works.)