The Men in Red were thoroughly outplayed in a re-run of last season's Heineken Cup semi-final as Brian O'Driscoll and co ran out 30-0 winners at the Royal Dublin Showground.
And O'Callaghan, who has now toured twice with the Lions, winning four Test caps, was unable to hide his frustration at the final whistle.
"It's hugely disappointing," O'Callaghan told the Irish Times.
"To lose a derby game is disappointing but it was the manner we lost it. We were totally dominated ."
Despite fielding a starting XV featuring four 2009 Lions tourists, with a further two on the bench, Munster were kept scoreless for the first time in Celtic League history.
The reigning Magners League Champions had headed back to Dublin looking to avenge their European Cup defeat five months ago but they instead left for home having taken an even greater beating then at Croke Park.
"We came out second best in every area," added O'Callaghan.
"We were blown off the pitch. It was tough enough against the wind but then to get opened up is hugely disappointing.
"Full credit to them, they put us to the pump and won all the contact areas.
"Their hunger was greater than ours and that is the disappointing thing for us. That is why it is embarrassing."
Former Lions skipper O'Driscoll was joined on the scoresheet by fellow 2005 and 2009 Lion Gordon D'Arcy, while Lions team-mates Luke Fitzgerald, Jamie Heaslip, Nathan Hines and Rob Kearney all featured for the home side.