First you should remember that your steel tip darts should not be sharp!
But why are the darts all sharp and nice when I buy them? That is because almost all people expect the darts to be sharp and not dull, plus it makes them look much better.
Really sharp darts will bounce off the wires allot more often, and will also ruin the fibers in your dart board when you pull it out of the board.
The sharpening tool (stone) should be used to remove the "bent" metal on the tip of the dart, also use it to make the point round and fine. Try to make it like the tip on a ball-point pen.
A flat point is worse than an sharp dart, when you hit the wire a flat point will almost always skip of the wires on your board, it will also flatten the fibres on the dart board.
Sharpen your tips often, maybe not between every throw, but it will often need a touch up, especially if you hit the wires.