I noticed the Wicker Man song in Hostel too. In Wicker Man, that's the scene where Britt Eckland sings topless then it cuts to a body-double for the full-body rear shots (doh!). Very memorable anyway.

I looked for the song in the credits of Hostel and it was there. It's called "How Do," though I have since forgotten who wrote it. I don't know anything about its inclusion in this movie except that the re-mix makes for nice trivia. It was cool to hear it.