The joke is that Kanako's little gag is only funny to Suwako (and maybe Sanae) because its a gag that references the mascot for a store chain that exists in the outside world. Since the dinut store chain doesn't exist in Gensokyo, Reimu and Marisa think she's a big dork and she's hanging herself in shame.
Kanako, Kanakooo!Bwa ha ha ha ha!Do that thing!Pon ◯◯ Lion. Pon de Lion, one mascot for the Mister Donut chain.What, what? Show us too!Pon de ◯ion.Bwa ha ha ha ha!.... You going to the hospital?Bwa ha ha ha ha!Crrkk......what?