2) Early to mid 20th century S Texas term for a rout. Colorful language used by the profoundly racist (white) Texans of that era. The joke being that in a fight, the Mexican always runs away and later explains that his lack of injury was because "We just stood & stared at each other for a while and then went home."
2)In a scene from "Monty Python and the Holy Grail," the killer rabbit quickly turns the skirmish into a Mexican standoff as the terrified knights obey King Arthur's order to "Run Awaaay!"
Nazi "That was the sound of my Walther pistol."
Basterd #1 "That makes two of us."
Basterd #1 "I've had a gun pointed at you since you've sat."
Nazi "Looks like we have a Mexican Standoff in our hands."
Basterd #2 "Say auf Wiedersehen to your Nazi balls!"
Boom! Boom! Boom!