Flashing CEL usually means a misfire, which jives with "stuttering" pretty OK.
CEL being on really has jack to do with needing an engine. The CEL is monitoring emissions. There are parameters (like the misfire) that also are relevant to performance, but the CEL being on doesn't have to mean there's something wrong with the engine. My Civic's was on almost the whole time I owned it, because the heating element in the $$$ front O2 sensor burnt out, and I wasn't spending hundreds on a good sensor just because the silly heating element burnt out. Likewise, yours could be on for something totally irrelevant, like an evap system leak.
Why it would stop when you use "sport-shift", I got nothin'. I'm not familiar with VDC, but outside of that, nothing's coming to mind sensor-wise that would cause those symptoms to appear or disappear.