Obviously my thinking is incorrect I thought the new pattern made by the step sequencer  could be put in front of the song pointer and everything behind it would remain the same.  It seems instead the previous pattern entirely is wiped out when you change the pattern on the step sequencer.  How am I thinking incorrectly?

If by song pointer, you mean Now Time Marker, then the explanation is simple.  Like a word processor, Sonar places the beginning of the content (your step sequencer pattern) at the Now Time Marker.  I don't believe it deletes what is already there, but the two end up on top of each other (which means both will play.)  Often times, the patterns are very similar so its not obvious but you will have notes (drums?) that are louder than you expect.  You could confirm that by placing a 2 measure pattern and then placing a 1 measure pattern and seeing if the second measure is still there.