As taken from Wikipedia, and which I checked out elsewhere, the first instance of this term is the title of a Jazz song from 1926 by Bennie Moten. Beyond that, it's a term that's only been given real meaning by the movie Lucky Number Slevin, in which it's used to refer to a kind of con game. Specifically a con in which a combination of distraction and subterfuge cause the mark to turn their attention away from the plot which proceeds in the opposite direction. The term itself is weighted with football, gambling, and other innuendo but since it didn't exist as a phrase until that movie was released, you could read that subtext into it or not. At it's simplest, a good head fake in sports is a Kansas City Shuffle. At a more complex level an army massing battalions of tanks on one front to occupy enemy attention and draw them out of fortified positions while in reality a naval attack ensues instead would also be a Kansas City Shuffle. In short, it's a cute name for a kind of misdirection.
Originaly slang for someone who is Hydrocephalic
, but which has now come to refer to any severe idiot or retarded individual.
Jones you mindless waterhead, how many times do I have to tell you not to stick the plastic bag over your head and play astronaut?!