Well, there are lots of variants of "nitro" too. Like now, the "nitro" on Fender's HWY 1's is a Sherwin Williams acrylic laquer product, a far cry from the nitrocellulose laquer of old.
The issue with real nitro is that it is not evironmentally friendly, and in some states (like California) it is almost impossible to use without getting a visit from the Board of Health, the local HAZMAT team, and OSHA. So now they use substitute nitro products.
I imagine it was used originally because it relatively fast drying time in its day.
Cool article about Fender's paint here
http://www.allbusiness.com/manufactur.../575114-1.html
