Hi Del,
SARK doesn't really understand call-waiting. It just switches calls to wherever you want them to go. It is the terminal (sip phone, ATA, whatever) which decides whether it can handle more than one call or not, SARK/Asterisk will just keep chucking calls at it until it receives a SIP "BUSY HERE" status back from the phone, which causes SARK to either redirect the call (if call forward on busy is set) or drop the call to Vmail.
Most SIP phones are multi-presence. When you are on a call, if another call arrives then the phone will usually flash the next available line button so that you can flip-flop between calls. In SIP parlance, this is usually termed "call waiting". When you turn it "off", you effectively force the phone to single-presence and in that state it will only take a single call before giving back a BUSY to asterisk.
I don't know if this answers your question or not because I wasn't sure whether you were referring to SIP call waiting or the call waiting tones you get from the PTT (common in America, not so common in Europe).
Best
S