I'm a bit confused by the double role which sheaves play in the theory of stacks.

On the one hand, sheaves on a site are the obvious generalization of a sheaf on a topological space. On the other hand a sheaf on a site is (or better its associated category fibered in sets is) a very particular stack itself, so a generalization of a space. This is not completely confusing: more or less it amounts (I believe) to identifying a space X with the sheaf of continuos functions with values in X.

But now my question is the following. An equivalent condition for a fibered category to be a prestack is that for any two objects (over the same base object), the associated functor of arrows should be a sheaf. In particular this is true for a stack, so for any stack and any two objects in it we have a sheaf, and so a stack (over a comma category).

What is the meaning of this geometrically?

For instance take the stack $\mathcal{M}_{g,n}$.

Giving two objects in the stack (over the same base object) means giving two families $X$ and $Y$ of stable pointed curves over the same scheme $S$, and the associated functor of arrows maps every other scheme $f \colon T \rightarrow S$ to the set of morphism between $f^* X$ and $f^* Y$. How should I think of the associated stack as a space?

To avoid misunderstandings I give the defition of the functor of arrows. Let $\mathcal{F}$ be a fibered category over $\mathcal{C}$. Take $U \in \mathcal{C}$ and $\xi, \eta \in \mathcal{F}(U)$. Then there is a functor $F \colon \mathcal{C}/U \rightarrow Set$ defined as follows. For a map $f \colon T \rightarrow U$ we put $F(f) = Hom(f^* \xi, f^* \eta)$. The action on arrows requires some diagrams to be described, but it's really the only possible one.