When I heard "Santa Claus is Coming to Town", I always heard "He knows if you've been bad or good" as "he knows if you've been batter good". I thought of cake batter at first, but then I reasoned that "batter good" was an odd term for "very good".
A childhood belief about misheard lyrics

others believed things like this
- when I was a little boy I thought i would become zidane but i was not as good as him— elbouteman10
- I thought that a person's motorskills meant how good they were at driving!Anon
- I thought when someone was described as being "mild-mannered" it meant they didn't have very good manners— Samilton Duerheiser
- When I was little I used to believe everything the government does is right and for the good of everyone.— Rob
- When I used to see a sign saying "Littering Fine" I thought they meant if you littered REAL GOOD!— Lou V.
- I used to think that my cat was an alien that had come to teach me how to be good!— laz