Hugman's right - the early Matt Walsh calls are among the gut-bustingest moments in the early Best Show, which is high praise. Now, some of that was how he worked with Jon Benjamin and Horatio Sanz, but it takes real talent to be a straight man.
My take on it is that he slipped up and Tom seized on it as part of the "this is a terrible night" bit. The two men have been doing comedy together for ten years.