Hi, Rich!
Remark accepted - clearing cache adds about 0.1s to the "real" time (at my particular laptop), and doesn't change "user" and "sys" measurements. The main conclusion of this benchmark (for me) is, that busybox sed is heavily non-optimal serving "g" flag in the grade of O(n^2) patterns found in the same string . And the other, less noticeable but more amazing (for me) is that lua is sedding faster than GNU sed, even in the easiest tests.
lua -e 'for i=1,65536 do io.write("1\n") end' > digits
Time busybox sed -e 's/1/2/g' digits >/dev/null
real 0m 0.27s
user 0m 0.26s
sys 0m 0.00s
Time sed -e 's/1/2/g' digits >/dev/null
real 0m 0.28s
user 0m 0.27s
sys 0m 0.00s
Time lua -e 'io.input("digits") io.write((string.gsub(io.read("a"),"1","2")))' >/dev/null
real 0m 0.04s
user 0m 0.03s
sys 0m 0.00s