First off I would assume Lancers master to be a girl simply because master and servants have always been the opposite sex from each other. As Kraco said this is based on a H-game and the whole matter of the magic circuit clearly to me at least reflected Shiro and Saber having sex even if that did not happen in the anime thats what the images represented.

As for this particular episode I found it to be simply confusing overall. Sense when have Rin and Sakura had a backstory as little girls. Why would Shirou not have been the one to save Sakura considering she's always had a thing for him. It just seemed like they skipped a episode and just started pulling plot devices out of random orafices. The only part of this episode that was actually good was the additional developement given to Assassin.