I'm almost positive the Blister in the Sun theme and the fact that the show or perhaps only encore was dedicated to MCA were purposeful. The Violent Femmes and the Beastie Boys both began with the intent of being part of the early 1980's American hardcore/punk scene. They are the only two bands I can think of from that scene that achieved commercial success and later they toured together. I also found a video of Brian Ritchie from the VFs new band doing a cover of Fight for your right. There may be more to the relationship between the bands idk about.

I'm also quite sure that the Blister in the Sun throughout the Second set was part of a larger theme of fun up-beat songs with corny and/or goofy lyrical songs during second set. BITS is the eptimity of corny upbeat fun and goofy songs of course but also Down With Disease and Boogie on are goofy and corny as is Golden Age. Backwards is perhaps the most corny Phish lyrics and Prince Caspian, while diverging this theme slightly, is for a slow song sort of an upbeat goofy song that builds up to the line with stumps instead of feet. Scent of a Mule lyrics are frankly out there; Mike's Song, while dark at times line "Me no want no nice guy" is obviously sort of out there. Contact too. The Beastie Boys music is sort of like this; upbeat fun with goofy lyrics like "I like my sugar with coffee and cream" or corny like "You got to fight for your right to party."

This would also explain why there wasn't much dark, spacey jamming during second set than many would've liked but frankly I think that was more due to the fact that it was a saturday night during a three-night weekend run. Friday was funky with some nice jams (97-98 like), saturday was more just fun rock and roll (something more like 94 and to a lesser extent 95) and sunday was more laid back and spacey (later 90's, post-hiatus). These seemed fitting to me at least.