I did a Wordwizard search and it turned out that Jonathon Green, in his Ask the Wordwizard, had discussed SHINGDIG here many moons ago. He also lists it in his Cassell’s Dictionary of Slang. Cassell’s is an amazing resource containing 82,000 entries and is quite reliable. And if I were to own just one slang dictionary, this would be it (and it’s very reasonable priced). The only weakness I’ve noticed is, when it comes to some expressions, he misses or is a bit off the mark on the American usage (e.g. as he he was in our recent discussion of good to go. But with 82, 000 listings nobody’s perfect. Anyway when I checked Cassell’s, I thought, is he ever off the mark on this one? But then I realized that he had provided what he took to be the slang meaning of SHINDIG and noted that the version many of us are familiar with is Standard English. However, a few dictionaries I checked did list it as informal, which, for the hair-splitters among us might be one baby step more acceptable in polite society than slang, maybe.
The following is an assortment of takes from respectable sources on the meaning and etymology of SHINDIG:
SHINDIG noun [mid-19th century]: An altercation, a violent quarrel, a tremendous fuss. [from Standard English], a noisy party or festivity + shindy/shinty noun (which was mid-19th century for a noise, a disturbance, a commotion . . .). (Cassell’s Dictionary of Slang. [[never heard of ‘shindig’ used in Cassell’s slang sense and only know what is here called the Standard English sense]]
SHINDIG: A slang term for a dance, a noisy celebration party or the like. The word is a form of SHINDY [[as in to kick up a shindy, meaning to make a row or to create a disturbance. The word shindy’ is probably connected with ‘shinty,’ a primitive kind of hockey played in Scotland and the north of England.]] (Brewer’s Dictionary of Phrase & Fable) [[So we see that what may be Standard English to one may be slang or even ‘informal’ to another – we’re not talking mathematics here (axiom/theorem/proof) when it comes to the English language]]
SHINDIG noun By 1871 a party, reception, festival, etc., especially a noisy dancing party; =clambake. [probably derived from shin dig ‘a blow on the shin incurred while dancing,’ found by 1859; perhaps by folk etymology from the older shindy]. [[I always thought a ‘clambake’ involved clams, but its other meaning doesn’t.]] (Chapman’s Dictionary of American Slang)
SHINGDIG; SHINDY: Shin-dig is first recorded in 1859, as a Southernism for ‘a kick in the shins.’ It came to mean a loud, lively party within 10 years or so and most authorities believe that the party shindig derives from the word meaning a kick in the shins. Another possibility is that the party name comes from the Scottish shinty, for ‘a wild form of field hockey played in Scotland’ and later, in America, shindy here possibly suggested by players being kicked in the shins. According to this theory, shinty (first recorded in 1771) became shindy (1821), a sailor’s word for ‘a spree, merrymaking’ and shindy by mispronunciation later became shindig. There was, in fact, a U.S. expression to kick up a shindy, ‘to cause a row or commotion,’ at about the same time shindig was born. I would guess that both shin-dig and shindig derive from shinty–shindy. (Facts on File Encyclopedia of Word and Phrase Origins) [[Looks like they covered as many bases as possible, just in case.]]
SHINDIG is thought to be a variation of ‘shindy,’ which in turn, is believed to be a derivative of hockey played by schoolchildren. Shindig today has two quite different meanings. . . . . . . . . . . (Morris Dictionary of Word and Phrase Origins)
Which all shows to go ya, when an origin is uncertain you can find a lot of entertaining reading on the subject.
OXFORD ENGLISH DICTIONARY
1) (see hoe-down : A noisy, riotous dance.)
“SHIN-DIG, a blow on the shins. Southern.”  U.S. Obsolete (Dictionary of Americanisms) by J. R. Bartlett<1849 “One of our party commenced a regular hoe-down, knocking his shins with heavy boots.”— California and Oregon, or, Sights in the Gold Region, and Scenes by the Way by T. T. Johnson, iv. page 38>
2) A country dance; a party, ball, ‘knees-up’; a lively gathering of any kind. Also figuratively. Originally U.S.
[[Note: The redoubtable Dictionary of American Regional English (DARE) doesn’t list shindig. And why not? ‘Regional English’ does not include Standard English, which they take it to be. But they do list shindy.<1871 “‘Is this a dashed Puritan meeting? . . . ‘It’s no Pike County shindig.’”—Atlantic Monthly, September, page 373/1>
<1892 “Shindig, a dance or party.”—Kentucky Words in American Dialect Notes, I. page 231> [I forgot to mention that in addition to S.E., slang, ‘informal’ English, there is dialect – not to mention ‘regional English’ (see below) and given a particular word (e.g. shindig) have fun trying to figure out what to call it.]]
<1935 “Does everyone attend those shindigs, Sandy, or is a girl invited by some special boy?”—Kings of Beacon Hill by C. W. Parmenter, I. xv. page 98>
<1956 “He was killed in an air defence exercise. One of those NATO shindigs.”—Thunder Above (1959) by Wallis & Blair, ix. page 98>
<1959 “The competition among the ‘old nobility’ to attend what they termed ‘Aspers' little shindig’ was so fierce that five private detectives were hired to keep out the unwelcome.”—New Statesman, 27 June, page 883/2>
<1962 “Kate never lacked a date for such shindigs.”—Klondike Kate by E. Luca, viii. page 162>
<1977 “‘What's a ceilidh anyway?’ . . . ‘It's Gaelic for a gathering, a shindig.’”—The Thorn Birds[/i] by C. McCullough, xi. Pafe 267>
<1992 “This was a $1,500-a-plate shindig for the Democratic Leadership Council, with such world-class lobbyists as Vernon Jordan and Ron Brown expected to attend . . . ”—Boston Globe, 14 December>
<2004 “. . . once she arrived at the shindig, she started firing off the one-liners -- and lining up the martinis.”— New York Times, 26 December>
<2010 “Each spring the Athenians would celebrate the Festival of the Vine Flower, a three day shindig which began with a drinking contest conducted in silence and ended with singing and dancing to melodies that excite the soul . . .”—The Independent, 16 July>
3) =SHINDY: A row, commotion, ‘shine’. Phrase to cut shindies (U.S.), to kick up a shindy.
Note: There were slim pickin's for quotes using definition (3).<1961 SHINDIG: An altercation, a violent quarrel, a tremendous fuss.”– A Dictionary of Slang and Unconventional English Supplement, page 1268/2> [[Oh yes. In addition to slang, informal, and dialect, there is ‘unconventional’ English.’]]
<1977 “They'd kick up a shindig, naturally, but it was always their husbands they were furious with.”—Glimpses of the Moon by ‘E. Crispin,’ vi. page 87>
(All quotes from the Oxford English Dictionary and archived sources.)
Ken G – July 19, 2010 (Ready for a family Labor Day shindig of the second kind and wearing shin guards just in case.)