Hengist means "stallion" in old Germanic and Anglo-Saxon.
Hengist was a Saxon King of Britain shortly before King Arthur's time, who helped King Vortigern defeat Scot and Pict rebels. Later, he led a rebellion of his own, and eventually founded the county of Kent. Quite what this has to do with wizardry, I don't know, but David Colbert offers a similar suggestion in his book, "The Magical Worlds of Harry Potter." (contributed by Adrian Allum)
A Hengist is mentioned in an English heroic poem The Finnesburg Fragment, which is also quoted in the poetic epic Beowulf. J.R.R. Tolkien believed the literary Hengist later became the Saxon king Hengist. (Wikipedia)
Hengist and Horsa (stallion and horse) is an architectural term for horse head carvings which decorate the pointed gables of houses. It's not hard to imagine medieval Hogsmeade decorated with some of those.