Jo’s suggestion that the story’s hero should be a skunk results in Jack, without initially intending to do so, basing the story on his own childhood. The choice of a skunk suggests to Jack that Roger might be bullied by the other animals because of his smell, and this causes Jack to remember “certain humiliations of his own childhood”. We deduce that Jack too had been bullied as a child, perhaps due to a noticeable difference between him and the other children in his school or neighbourhood, a difference that he might have wished could have been removed by a wizard’s magic spell.
What was this difference? Updike does not say, but maybe we can guess it from the reaction of Roger’s mother in Jack’s story. We are all but told that Roger’s mother corresponds to Jack’s mother, for when Joanne says that Mommy Skunk was stupid,
“It was not,” he said with rare emphasis, and believed, from her expression, that she realised he was defending his own mother to her
So if Mommy Skunk objects to Roger wishing away his smell, what did Jack’s mother object to Jack wishing away? Perhaps Jack belonged to a visible racial minority in a predominately white neighbourhood. It would then be likely for Jack to be racially bullied, to wish that he could be white, and for his mother to object to her son wishing away his own identity. (It is perhaps significant that the wizard lives in a “little white house”.) This would explain Jack’s feeling of being ‘caught in an ugly middle’ in the story’s final paragraph:
The woodwork, a cage of moldings and rails and baseboards all around them, was half old tan and half new ivory and he felt caught in an ugly middle position
(My emphasis.) There are a couple of other clues to Jack’s origins. His stories always involve a lack of pennies, perhaps indicating that he grew up poor. He pronounces “creek” like “crick”, a U.S. dialect variation indicating a rural Southern upbringing.
Under this interpretation, when Jack says, “poor kid”, he is simultaneously referring to himself as a child suffering racial bullying, and to his fears that his daughter Jo (who is coming up to school age) will have to go through something similar.
As for the question of why Jack “did not want to speak with her [Clare], work with her, touch her, anything” in the final paragraph, telling the story of Roger Skunk has brought up powerful emotions for Jack, and the narrative has repeatedly suggested that Jack has trouble managing his emotions:
Jack answered curtly. She had made him miss a beat in the narrative.
Jo made the crying face again, but this time without a trace of sincerity. This annoyed Jack.
Jack didn’t like women when they took anything for granted; he liked them apprehensive, hanging on his words.
“Joanne! Shall I come up there and spank you?”
If Clare were white, as suggested by the way he links her with cocktail parties (a stereotypically WASP-ish activity) then that would be another reason why Jack feels that he can’t share his emotions with her.