Hi Fran, I partly agree with what you just said. My comment before that was about the subtext, of course, not Jack's actual literal meaning. It didn't occur to me that Paul might be asking literally what Jack was talking about, perhaps not having heard the phrase as a once-common euphemism for going to the restroom. Yes, Jack was making small talk and using a common idiom of the day. And it's a way to carry the conversation along with small talk. To me, it works just fine on that level.
But most if not all of the lines in the film carry multiple meanings, and I think this one serves a second purpose. Subtextually, I see the entire dance scene as full of subtle remarks -- often digs -- about sexuality, including sexual orientation, sexual activity and masculinity. Men never dance with their wives. Jack and Randall don't have a smidgen of rhythm between them. Randall isn't mechanical. He wouldn't listen to LaShawn if he were going deaf tomorrow. LaShawn spent more on clothes than she made at N.M., which is more than Randall ever will make. Then there's the question of who Jack's actually asking to dance and the underlying meaning of Randall's invitation.
To me, the nose-powdering remark is another one of those. Subtly, unconsciously, Jack is saying there's nothing going on in bed that's worth getting gussied up for.