It's actually a reference to how the crew noticed Merritt Stone's name in several of their films (all of which get referenced in the sketch in question) but none of them could actually spot the recurring face in all of them.
For the record, it eventually got to the point where, in the ending bit with the Mads, TV's Frank has been driven to madness trying to figure out who Merritt Stone is.
Not Bad: During the scene with the slumming couple in the coffee house.
Heckling Husband: Let's us go on a fool's errand before they throw a butterfly net over us! Crow: (as beat poet) Hey, man, that's beautiful!
Train Problem: In the sketch where Joel tries to have the 'Bots write literature that would meet Merritt Stone's approval, Gypsy succeeds by reciting one of these. They also call Tucker's plan "the SAT caper" after hearing the page quote.
The MST3K treatment of Johnny At The Fair brings us: