One Step Beyond - Madness
Blitzkreig Bop - Ramones
Dancing With Myself - Idol, Billy
Lust for Life - Iggy Pop
Rock Lobster - B52s
Ca Plane Pour Moi - Plastic Bertrand
Surfin’ Bird - The Trashmen
Ballroom Blitz - The Sweet
F1-11 Love Missle - Sigue Sigue Sputnik
I’m a big fan of Daddy Cool.
Some Indian stuff, perhaps? - Say Shava Shava from Kabhi Khushi Kabhie Gham, and Bhangra star Daler Mehndi’s Tunak Tunak Tun. Just follow the youtube suggestions for more Indian goodness.
Caution by Tashannie (but you won’t be able to sing along unless you know Korean rap very well!)
True Faith by New Order
Good Times by Aretha Franklin
Living In America by James Brown
And two very old songs that kids of all ages love…
Sugar Sugar by The Archies
Chirpy Chirp Cheep Cheep by Middle Of The Road
We Like to Party, by the Vengaboys
Dragostea tin dei, by Ozone (the Numa Numa song)
I Love You, Ono, by Stereo Total (I adore this song)
Show Me, Mint Royale
Letter From an Occupant, The New Pornographers
Everybody’s Got Something to Hide Except For Me and My Monkey, The Beatles
These are fabulous, I was actually looking for something along those lines a few days ago. I really want to include some music from different cultures.
Also, Tunak Tunak Tun wins the prize for cheesiest ever music video.
Is this a whoosh? Doesn’t this song have lines about people being dragged down alleyways and shot in the head?
Weapon of Choice is an awesome, awesome song; so much so that we already have a whole lesson planned around this song alone. So you were pretty much right on target with what I was thinking.
Can’t go wrong with Ace of Base - (I Saw) The Sign!
I re-discovered this song a few days ago on YouTube. What a blast from the past.
I love that song.
Valete,
Vox Imperatoris
Well, if actual kids’ music may be mentioned, here are a few that have been known to be favorites of parents, sometimes moreso than of the children:
Smilin’ Island of Song – Cedella Marley-Booker (mother of the late Bob Marley), and featuring Taj Majal. Reggae, of course.
Ralph’s World (Ralph Covert from Chicago’s Bad Examples) has released a bunch of children’s music and has been pretty successful touring.
Jessica Harper has several releases – Rhythm in My Shoes and Nora’s Room, among others, that contain some fun, upbeat songs.
Boy, does this make me feel old.
Not the most kid friendly lyrics, this one. I like many of your other suggestions though.
What about “What I like About You” by The Romantics? Or the Billy Idol version of “Mony Mony”?
Ach du lieber! I almost forgot what’s probably the perfect song for your purposes…
Original Swedish version also available, on YouTube and iTunes. 
That isn’t actually the original. It’s sped up 15%. The original is better, in my opinion. (And the English version is horrid.)
Everyone has stolen my suggestions! I came in thinking of “Every Time We Touch”, but that’s already been suggested. I think some of the others (like maybe Caramelldansen) are a bit *too *upbeat for the OP’s purposes. Maybe I See Right Through To You by DJ Encore would be good, if it’s not too rave-y. But on the subject of ridiculous Swedish dance music, I have to suggest Doki Doki by Smile.dk, plus the remixes (especially the Panik remix).
Valete,
Vox Imperatoris
Also, Je Veux Te Voir, but the lyrics are completely inappropriate. It’s in French, though! 
And Aqua would definitely qualify, but again, I think they’re too ridiculous.
Valete,
Vox Imperatoris
James Brown, I Feel Good. The lyrics could be about sex, but they could just be about feeling all comforted from cuddles too.
I’d never really noticed the lyrics of Hey Ya before. Maybe because the dodgy bits are pretty much indecipherable.
Walking on Sunshine is a great choice.
I didn’t even know there where any other versions of Come on Eileen. I’m pretty sure I’ve only heard the original.
Misirlou/Miserlou, that fast guitar track from Pulp Fiction, is one I’ve used in classes before to signify that a timed activity’s about to end. There’s no better frantic, energetic hurry-up song. I didn’t know when I used it, but it has an interesting historytoo.
A couple more Pointer Sisters songs: “Dare Me” and “Automatic.” You just can’t go wrong with the early 80’s Pointer Sisters music. In fact, “Dare Me” is so high-energy & upbeat that it sent Casey Kasem into a rage. (Read the 2nd paragraph under “outtakes.”
Eye of the Tiger
Two by Jonathan Coultan
Mandlebrot Set
http://www.youtube.com/watch?v=P1Xid_zLP4k&feature=related
Code Monkey
http://www.youtube.com/watch?v=v4Wy7gRGgeA&feature=related
Oh, picky, picky, picky.
Besides that, it’s so overpowered already that, at it’s worst, you can only possibly make it slightly less overwhelmingly happy and upbeat. 