The human digestive system is unable to digest or break down certain foods such as corn. The inevitable result is that such items make their way through the digestive tract intact in your poop. A friend of mine discovered that he cannot digest baby octopi. He found this out when he say several little octopi swimming in the crapper.
These little critters were determined to have gone "downtown" at this point. "Squid" sounded better than "Octopus" and thus, the term "Downtown Squid" was born.
The term can be applied to anything that comes out in your poop and is instantly identifiable.
I I shouldn't have eaten that octopus salad at the Chinese restaurant. It'll surely be "Downtown Squid" tomorrow afternoon.