Does "It's just a cracker" mean "It's just a joke"?

(1) Does "It's just a cracker" mean "It's just a joke"?

(2) Does "living wafers" refer to "thin disks of unleavened bread that is supposed to the flesh or blood of Jesus Christ"?

But for sheer gothic absurdity nothing surpasses the medieval
concern over host desecration, the punishment of which preoccupied
pious Christians for centuries. The doctrine of transubstantiation
was formally established in 1252 at the Fourth Lateran Council (the
same one that sanctioned the use of torture by inquisitors and pro-
hibited Jews from owning land or embarking upon civil or military
careers), and thereafter became the centerpiece of the Christian
(now Catholic) faith. (The relevant passage from The Profession of
Faith of the Roman Catholic was cited in chapter 2.) Henceforth, it
was an indisputable fact of this world that the communion host is
actually transformed at the Mass into the living body of Jesus
Christ. After this incredible dogma had been established, by mere
reiteration, to the satisfaction of everyone, Christians began to
worry that these living wafers might be subjected to all manner of
mistreatment, and even physical torture, at the hands of heretics and
Jews. (One might wonder why eating the body of Jesus would be
any less of a torment to him.) Could there be any doubt that the
Jews would seek to harm the Son of God again, knowing that his
body was now readily accessible in the form of defenseless crackers?
Historical accounts suggest that as many as three thousand Jews
were murdered in response to a single allegation of this imaginary

I wonder what "host" means there.

the Latin word for it: "hostia"

I wonder what "host" means there.

A Hostia is a portion of bread used for Holy Communion in many Christian churches.

In Catholicism, <where> the host is held to have become the body of Jesus Christ,