Funny you brought this sauce up today...i had printed that recipe out and was tempted to try it this week myself. But this sauce is very similar to what is used in authentic indian cooking....to make anything with a gravy, like potato or koftas or anything else, we use a sauce just like that one. As you must have noticed, there is no curry powder!
One other thing if I may point put, there is a masala called "Kitchen King" by MDH - apparently it is an all purpose kind of seasoning that many indians I know buy in huge, I mean HUGE, boxes!! The main ingredients seem to be coriander and turmeric as it is yellowish but it looks like coriander powder. I have started using it in almost all my dishes and it adds a great flavor. I know you can get the list of ingredients online at the MDH site. May be worth a try - maybe its like Ray's basaar mix?!!
Back to the "Daag sauce" - the onions must be cooked very slowly with plenty of oil - then they can be cooked 20-30 minutes without being burnt...i do my onions like that for some indian dishes but there must be enough oil. I will post my findings once i make the sauce too but i will make half the quantity - I dont like to freeze things - have too much free time as it is ;D
Payal