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Your are missing in your layout handle

<instagram_scroller> //here the layout handle is not correct, it should be like something like <instagram_scroller_index>
    <reference name="head">
        <action method="addItem"><type>skin_js</type><name>js/instashow/jquery.instashow.packaged.js</name></action>
    </reference>
    <reference name="footer">
        <block type="core/template" name="instascroller_script" template="instascroller/script.phtml"/>
    </reference>
</instagram_scroller>

The layout handle is constructed like this: <routerName_controllerName_actionName>

And use <?php echo $this->getBlockHtml('instascroller_script'); ?>