In the US, it is apparently a euphemism (or media-invented myth)for rather lewd naughtiness (see all other definitions). In the UK, it means jelly, ice-cream and dressing-up as
Zippy,
Bungle, Geoffrey, George, Rod, Jane or Freddy and singing "The
Wheels on the Bus". The latter seems condusive to a much more satisfying experience.
Yank: Dude, I'm so emotionally crippled and shallow, I went to this badass
Rainbow Party last night. Now I feel even more empty and my dick's kinda itchy.
Limey: I say, old bean, I had a Rainbow Party last week! We all had a
beezer time, despite
Bungle having eaten too much jelly and ice-cream.