1. The first letters of each singer's first name: Abba
2. Spanish for "The Wolves": Los Lobos
3. Very difficult financial circumstances: Dire Straits
4. A sex toy in William Burroughs' novel Naked Lunch: Steely Dan
5. Half the members were British and half were Americans: Foreigner
6. The villain in the movie Barbarella: Duran Duran
7. Because they thought the group would flop, just like a very heavy dirigible: Led Zeppelin
8. An old make of fire engine: REO Speedwagon
9. An Egyptian legend about a deceased person who gets helped by a living person, then pays back the favor: Grateful Dead
10. The British government: Parliament
11. The British head of state: Queen
12. The number on the British unemployment benefits form: UB40
13. The movements of the eye when dreaming: R.E.M.
14. The bus and train system in their hometown (later changed to just the town's name after the bus and train system threatened a lawsuit): Chicago (Transit Authority)
15. A high-school phys ed. teacher: Lynyrd Skynyrd
16. The drummer's last name and part of the bassist's last name: Fleetwood Mac
17. Francis Gary Powers' spy plane: U2

Bonus: Chosen deliberately to confuse people, in the manner of an old Abbott and Costello routine about baseball: The Who