it sounds a bit like the concept of silent disco, except for the "bring your own music" part of your idea.
http://www.cnn.com/2005/TECH/09/01/s...sco/index.html
i've been to a thing similar to that about 6-7 years ago (despite the article mentioning it originated in 2002).. people were given a small fm radio + headphones at the entrance and you had to tune that to a certain frequency to hear the music. the funniest part was when you took out your headphones and watched people dance in silence... i don't know if it would work if everybody was dancing to a different tune though... maybe too many people might feel embarassed.