Don'cha just love google?
[Q] From Brad Lytle: “I’m not sure how you would spell hunky dorey, but it means ‘just great’, or something like that. Where does it come from?”
[A] The Random House Historical Dictionary of American Slang suggests that the term may have been introduced in America about 1865 by a popular variety performer named Japanese Tommy. Other references suggest that it may have been sailors’ slang for a street in Yokohama that catered for what one might describe as the special needs of sailors. In Yokohama today a broad thoroughfare called Honcho-dori runs from the centre of the city to the port area, so one that would have been familiar to sailors (dori is the Japanese word for a road, in particular a broad or important one).
What seems certain is that hunky-dory was a play on an existing sense of the word hunky for something that was fine, splendid or satisfactory. In turn, this probably derives from the adjective hunk, which means that one is all right or in a safe or good position. This derives from the Dutch honk, meaning “goal” or “home” in a Frisian variant of the game of tag. This word (and presumably the game, too) was said to have been taken by the Dutch to New Amsterdam, later New York, but was first recorded only around the 1840s. It has links to another reduplicated term, hunkum-bunkum. Though the first part sounds a bit like the hunker of hunker down (which is also of Dutch origin), the words seem not to be related.
It may be that hunky-dory was the result of a bilingual pun, perhaps invented because American sailors knew the word dori and prefixed it with hunky as an imagined Japanese street of earthly delights.
And another similar one:
From William and Mary Morris's Dictionary of Word and Phrase Origins: The story goes that the principal street of Yokohama was Huncho-dori street. (OK, Danny, is that true today?) A sailor on shore leave would feel that everything was OK when he was on the main street.
Another story however (attributed by the Morrises to Charles Earle Funk) traces the origin back to the Dutch settlement of New Amsterdam: taking the word hunk as derived from the Dutch word honk for goal. When you reached the goal, everything was hunky-dory. How the dory got into the expression was not clear.
We do know that Christy's Minstrels of the mid-nineteenth century popularized a bit of corn called "Josiphus Orange Blossom" that contained the lyric "red hot hunky-dory contraband." The song was a hit and hunky-dory came into the language.
That song arose during the Civil War. Since Japan was not opened to foreign ships until Commodore Perry's visit in 1854, it seems somewhat doubtful that the Yokohama theory holds water. More likely, hunky-dory was already a slang term when American sailors first had shore leave to Huncho-dori Street.
WinCustomize Forums
But they didn't say it that way where I came from...and I'm old too..maybe that's the Aussie version? 
