Good comment! I admit I wasn't sure what to make of the Nazi stuff in the lead-up to the clown encounter. That Xander's not scared of spiders, but is scared of Nazis, suggests he has some knowledge of the capacity for human evil.

I'll add that this isn't the first reference to fascism (and particularly Nazism) in the show. The shooting script for Welcome to the Hellmouth compares the Master's robe to an SS uniform. And Snyder is referred to as a Fuhrer by Giles in The Puppet Show. ("I think they just call them principals now.")