Audio problem: When the band starts to play the guitar solo doesn't match the guitar player's fingers or picking. (00:41:10)
Audio problem: In the second shot of the band playing, the band members are singing into their microphones, but no voices are heard. (00:49:40)
Answer: It never really says what the body is, but I'd assume it were a rabbit or some other small woodland creature. It can't be Muffin because, like you said, Muffin appears later on.