I've noticed the trend a few years ago - seemed to coincide with the Boardwalk Empire series.
I don't personally associate the haircut w/ Nazi Germany, and I've sported something similar for years, simply because I cut my own hair and that was the easiest thing short of a buzz cut. Plus I have a rather big head and I need some hair on it or else I look like a giant light bulb.
There is something military to it I guess - as a cadet when I was a teenager, I used to grow my hair where I could, and the only place was on top...
If one associates it w/ Hitler and still goes on sporting it, I think they're unconscious - as a lot of people seem to be. I don't think they really realize...
That being said, personally, I'd rather see someone with that type of haircut than w/ rastas (which make me nauseous) or those long hipster beards. At least it looks cleaner.
EDIT: Or those kids wearing a tuque 365 days a year, inside, outside...