I always thought its origins were from ships, but its the magnetic compass adjustment/polarity balls either side that were the 'balls' in question.

The magnetic compass on ships exits into the wheelhouse so the person at the helm can steer.

The roof of the wheelhouse is the monkey island and it is the alternate steering position and its here that the kelvin balls are located.

see here....

http://en.wikipedia.org/wiki/Brass_monkey_(colloquial_expression)