SOOKIE: I’m just – do you hear something?
LORELAI: Like what?
SOOKIE: Like someone using the wrong size pan to sweat the onions in.
In culinary terms, “sweating” means to cook something over a low heat in a small amount of fat or oil, usually in a covered pan or pot. It’s usually done with vegetables such as onions, carrots, and celery, and the idea is to soften them without browning before you add other ingredients. Sweating concentrates the flavour and releases sweetness, with the vegetables becoming tender, and onions in particular, translucent.
“The wrong sized pan” for sweating onions is probably one which is too small and would heat up too quickly.