Magic mushrooms can alter how people hear and feel music at festivals. Many report richer textures, stronger emotion, and a deeper pull toward rhythm, sometimes with a shifted sense of time.
Dancing can feel more fluid if self-consciousness drops, but coordination and balance may be less reliable, and lights or crowd energy can become intense. Set, setting, and dose matter a lot.
A sense of connection to the crowd and environment is commonly described, which is one reason some attendees choose psychedelics. I cannot verify claims that mushrooms are healthier than MDMA or that they do not affect serotonin. For context on why some people use magic mushrooms, see this overview.
Bottom line: psilocybin may intensify music and change movement, but the experience varies widely by person and situation.