This quote comes from Chapter 1 of this excellent novel, which is made rather difficult to understand because of the way that, stylistically, Joyce is trying to achieve something that is rather unique and different in his presentation of the life of Stephen Dedalus. As he writes from a third person perspective, but tries to ensure all memories are filtered through the awareness of Stephen Dedalus, in the first chapter, the narrative is written from the perspective of a child, and this is true stylistically. For example, note the following paragraph, from which the quote under consideration in this question is taken:
Rody Kickham was a decent fellow but Nasty Roche was a stink. Rody Kickham had greaves in his number and a hamper in the refectory. Nasty Roche had big hands. He called the Friday pudding dog-in-the-blanket.
Clearly Rody Kickham and Nasty Roche are being compared, with Rody Kickham being more favourable than Nasty Roche, as his name suggests. Yet the content is something that a child would identify, as the rather abrupt and short sentences indicate. "Greaves" refers to shin pads, which Rody Kickham had in his "number," or locker, but Nasty Roche is "nasty" because of the way that he describes the "pudding," or savoury dish made with meat, as being "dog-in-the-blanket," something which reveals his sense of dark humour, as the pudding was meat covered in batter, and therefore could resemble dog meat covered up in a blanket. Nasty Roche is a young boy, who, like young boys everywhere, has a rather earthy sense of humour, but this is something the protagonist does not appreciate.