To have sexual intercourse and cause a person (mainly a woman) to explode with so much pleasure that she don't know where she is and all she wants is more! She has been Shag Stupid and still wants more.
Could also mean to beat a person at :a game; sport or in a fight.
(1) In a sexual way (to shag stupid):
(a) Man says to a woman, "I'm going to shag you stupid tonite!!"
(b) Woman says, "yeah right." Dismissively.
The night comes and the man starts to shag the woman. Four hours later when the man spunks up in her and she is wet as fuck and will be sore as fuck in the morning (which is probably now). She still wants more! As if she hasn't had enough: this is shagged stupid as she is stupid now!
(2) To beat a person at game or sport.
(a)I bent over the goal keeper and fuck him up the arse. (Meaning that the goal keeper couldn't handle the shots being played at him) Their team were shagged stupid.
The idea above is that the team victorious were superior in fitness, skill and strength and the other team were so overwhelmed with this that they looked stupid while playing. They have been shagged stupid so to speak.