Similar situation in one branch of my family - her mother has similar feelings. Well, slightly different - I'll explain.
I don't think she would quite compare it directly to drug addiction as her other child did go through a period of drug addiction and she has a real world view of that and can see how different it is. The mother feels that lesbianism is a difficult path, that there are challenges and the potential for unhappiness due to 'poor choices' (her words, I can't claim to really understand them) - my reaction to those feelings was that while heterosexuality doesn't have the same acceptance issues hetero relationships can have problems too and there is no way to protect her child from that. Her daughter could easily end up in a bad / difficult relationship with a man as with a woman. She seemed to take that on board.
Her other main problem with her daughter's orientation was that she felt somehow that she (the mother) had made a mistake in bringing up her daughter that had caused this to happen. Ha! I thought to myself - the other child, with the drug problem, is older and had gone through addiction issues before the daughter outed herself. I know both the mother and father felt they had someone failed their child when drugs became a major problem. So here she was, a few years later, having similar feelings about her daughter's sexuality. While she was not comparing the fact of her daughter's sexuality with drug abuse she was making the assumption that both come about by a trauma or unhappiness.
What I tried to explain to her is that her daughter's sexuality and choices are not self harming in the way that drug use is. Not getting into the whole nature / nurture argument, it is clear and evident that people with happy, safe, loving childhoods do grow up to be gay - that is just a fact. There is nothing self hating or para-suicidal about being gay. Certain people may express those kinds of negative behaviours in their sexual practises but that is by no means limited to homosexuals.
Funnily enough the father in the family is totally unfazed by and very supportive of his daughter's choice. I don't quite know what the difference is - the mother is quite a hand wringing, doubter who assumes the worst in many situations, whereas the father tends to be a lot more laid back and takes things as they come. Fortunately, with the input of her husband and probably others, the mother has never discussed her feelings of disappointment with her daughter.
I think in the situation of the OP and his sister someone needs to talk to the mother and attempt to explain that lesbianism is not going to ruin her daughter's life, that it is not a negative and self-harming behaviour and also how hurtful it is for her daughter to hear that her mother views her as having something wrong with her as it implies that, ideally, there would be a 'fix'. She needs to be told, in no uncertain terms, that her daughter is not broken - just different - and part of loving her daughter is working towards accepting that. It won't happen overnight but the greatest love she can show her daughter is to learn.