There's been a very weird discussion going on here based on the misconception that TMs are somehow equivalent to Interactive TMs[1]. In the usual theory of TMs there's no idea that there's "input" (e.g. another TM altering the tape) or anything similar. You just give it a starting position and the initial state of the tape and let it go.
Yes, but it should be noted that a sed-interpreted word would also need to emulate the OS and the hardware, as I imagine that the syscall you can make from sed are limited