As an Iranian-American, I've made similar blunders in trying to communicate with my Mexican friends and colleagues. "Hey amigo, do you need a chauqeta?" I would ask to the eruption of laughter. If you look up "Chaqueta", translation services will happily tell you it means "Jacket". Don't trust it. Apparently to some Mexicans it also means jerking off.
I know that some cultures consider it rude to laugh at this sort of things when it's not the speaker's native language (brits don't even correct me when I misuse/misspeak english because they think it's rude), but for many (most?) cultures it's really not, that's not being a jerk
This is a regional bro distinction. I have certainly heard chaqueta used by respectable people in Jalisco. This joke is a reflection of people that don't travel.
In Jalisco y Nayarit the normative word for the large beer bottles is caguama. In central MX that word is ghetto.
