The meaning I had heard was that the weasel was a hat - made out of weasel
rather than more expensive pelts, and to pop something is to pawn it.
So, when you think of the rhyme:
Up and down the city road (i.e. strutting around in your finery with your
posh hat on you head)
In and out of the Eagle (going into the pub for a drink or two)
That's the way the money goes (when you buy the drink or two)
Pop goes the weasel (you pawn the hat so you have more money)
But I like the other explanation too, especially if the spoked wheel came
around and 'popped' you on the head if you weren't paying attention
Malvary in Ottawa
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