it's implied that it's a plot point that'll be expanded upon later. remember the bat lady (I forget her name)? she was studying that sort of stuff, and it's implied that Cole's conception is the result of her research
My guess is Cole's dad has just sprayed sperm on the magic egg like how fish fertilize eggs. Cole's dad whom he got DNA from probably is Hamish since the two look somewhat identical plus both Hamish and Cole can do magic.
