Here's the facts from the lips of Fagen himself. The following article appeared in the December 25, 1976 issue of Sounds:
"Well, the first few verses are plain enough. Babs and Clean Willy get married, right? But things don't work out somehow, and off they go to Haiti to grab themselves a quickie divorce. Then Babs heads off to some sleazy night club to drown her sorrows."
"If you've been paying attention, you'll know she's in a drugged stupor by now and probably doesn't know anything about it. She is later... er... impregnated by this exotic gentleman. Later she is reunited with Clean Willy and they have some rather bizarre offspring ("Who's this kinky so-and-so")
And then the chorus marks a second expedient divorce."