this is important to me as an american living in Brazil
gringoes.com
says (after serious search this was the best, and
unca Cec doesnt address this question - that I could find-
most common thought is that its a term from the Mexican
american war, U.S. troops had green uniforms, the Mexicans
would shout at them “GREEN GO” - right,
“it is
unlikely the Mexicans
would have been speaking
English and also the word
had already
croped up in Spanish as far back as the18th century. The
most likely source of the term derives from the word
griego, Spanish for Greek, which has long been used as
a convenient metaphor for anything foreign and
unintelligible. Even the Romans had a Latin phrase for
the feeling of being stymied by the unfamiliar: “Graecum
est; non potest legi” meaning “It is Greek – it cannot be
read,” or as we say today, “It’s all Greek to me.””
This is from the farthest reaches of my memory, but I recall that one explanation is that it came from Americans singing a popular song of the times - “Green grow the lilacs all sparkling with dew / I’m lonely my darling since parting with you.”
Webster’s New Collegiate says a variation of griego, “Greek”, used for any foreigner (but especially English speakers). Much like the English phrase “It’s Greek to me”.
“Green go the lilacs” is pretty thoroughly discredited and the idea that the Mexicans would be cheering on American soldiers in English is preposterous on the face of it (not to mention the fact that paintings of the war show U.S. soldiers in blue uniforms, not green).