If Sterling just beat Pedro after Pedro knocked the fuck out of Cody, Sterling shouldn't have to go backwards to fight him.
Knowing the UFC, they want to do the Faber fight as soon as possible. Now, I think Yan is slightly closer to a title shot than Sterling but concede they're very close and at least Sterling is a bit known, so they could do Cejudo-Sterling, and do Faber-Yan for next. Faber can immediately legitimize himself for a title fight with a top win or the rightful contender Yan can get some attention to his name with a win over the mini-legend that is The California Kid.
In the meantime, Moraes and Cruz should fight for the immediate bounceback from title losses, which would be exciting, and Cody and Assuncao compete for the chance to rebuild their top contendership. Assuncao fights a former champ and Cody fights a tough guy without a lot of the KO fear. The winners of those would likely fight each other for the next shot after Yan/Faber
In the meantime, Joe B sits in the corner on Megan Olivi's lap, despising his old coach for returning.