I remember reading about it on ihatemusic, but i can't find the thread anymore. It's probably been deleted when they moved forums a while ago...
but i did find this:
That No Neck Blues Explosion 7" was indeed a hoax - it was done by the two principal minds behind the fanzine Tuba Frenzy, who were also in the band Joby's Opinion...some '90s Chapel Hill, NC ephemera. One of them told me he sent a copy to - I think - David Nuss at the time, and he wasn't too amused.