> It's referring to the comment on lines starting with 2938 and the
> subsequent code which uses 'looking-at' instead of
> replace-re-search-function.
>
> Here's that comment in full:
>
> 	  ;; Otherwise, if matching a regular expression, do the next
> 	  ;; match now, since the replacement for this match may
> 	  ;; affect whether the next match is adjacent to this one.
> 	  ;; If that match is empty, don't use it.

Thanks, now everything is clear.  Then it can be simplified by this patch: