Linux sed Behavior – Why sed Acts Differently Depending on Output File

grep supports getting patterns from a file -f, and becomes more efficient if you also specify fixed strings (-F):

grep -F -f patterns.txt "//'MVS.DATASET'"

Your sed script, as it stands, will always print the first line regardless of whether it was modified. The default action for sed is to print its pattern space (current input line¹) to standard out after it's done applying all your other commands.

So, basically, what you're telling it to do is to apply a few substitutions and then quit. What this means is that it will try your substitutions on the first line and print it after the substitutions (regardless of whether they were successful) since this is the default action. It then encounters q and quits processing altogether.

If you want to suppress the default printing action, you need the -n switch, but then you need to explicitly instruct sed to print the lines where substitution was successful:

sed -n 's/REM[ \t]*GENRE[ \t]*"\(.*\)"/\1/p;q' your_file_here

Now this script will print the first line where the substitution was successful and then quit.

Note that you didn't need two substitutions, only one is enough.

Unrelated side note

No need for

cat your_file | grep 'foobar'

when

grep 'foobar' your_file

would do.

¹Not always the current input line: you may for example add lines to the pattern space.