UGH! I sure wish my memory was still like it once was, but I'll try... (Somebody help, please!)
Stefano found Susan (who looked enough like Kristen with modifications) to have a baby. (I THINK it was for Kristen to hold onto John.) I actually think that those lines today was to make up for the fact that EJ has been aged incredibly to the point that there's no way Kristen is old enough to be his mother. Because of that, I think they were making up a line to make us believe that Susan was actually older than Kristen even though we know she wasn't (if we watched then). Did any of this make sense and/or help?
Sheryl, as to how Kristen already knew, I just chalked it up to being yet another time that Stefano "knows all" and told Kristen...?