His wish was changed to "I wish Karyn was here doing you instead and that you would just leave!" The stone, still having some of the traits of the old one, couldn't reverse wishes, meaning that it could not make something happen "instead" of the previous result, nor could it make Sarah leave (therefore reversing the wish that Sarah be here).
So all of a sudden, Karyn was naked, having sex with Sarah. Jon's eyes nearly popped out. He had to admit it was pretty hot, but it wasn't at all what he wished for. And Sarah suddenly whispered, amidst moans, "Is this enough, Jon, will you have sex with me now?" She was obviously still desperate to do so, and would even have sex with a girl if it meant she could then get Jon....