Someone's been watching too much porn.
Hama cheez ba-Beer behtar meshawad!

I always wondered if they hired adult film starlets or strippers to do the dance sequences
most likely

I always wondered if they hired adult film starlets or strippers to do the dance sequences - the unofficial rule in Hollywood when the nudity and simulated sex get too gratuitous. It's hard to tell what race they are either under the constantly moving blue light, but I've guessed they were black male dancers and white female ones.
"Everyone else may be an a**hole, but I'm not!" - Harlan Ellison

Peter Boyle's got his hands in everything he surveys as if he were a Capo or if he were a Juan Peron/Benito Musolini. He's even got access to his own private Murder Inc. in order to hire out of town buttons to commit his murders as furtively as possible.. Not only that, but he's got the cooperation of the most captive audience there ever was. There's no possibility that the two of them (Dr. Lazarus and Connery) could have beaten Boyle's hit team, let alone won the whole war against Boyle who's "connected" and has control over all the activities onboard the space vessel, which is tantamount to being a "crime lord"
due to the existence of both legal and illegal activities under the protection of his army of hundreds of junkies, pushers and profiteers that are protected from the law by their being holed up in outer space with each other and where Boyle has the advantage.

If I recall, from Alan Dean Foster's novelization of the film, the dancers were holographic images. Judging by the laser-light effects, I'd say that was a very accurate description/depiction.

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These dancers always astonished me, also. I think, its a credible idea (Ive once seen simulated sex in a German tabledance bar!), but amazingly unreserved for the time the movie was made, just like the thing with the prostitutes.
"Hooters, hooters, yum yum yum,
Hooters, hooters, on a girl thats dumb!"
The Bundy credo