The Great Interactive Dream Machine, by Richard Peck

Josh Lewis’ best friend, techno-nerd Aaron Zimmer, has turned his computer into a wish-granting machine. The formula is not quite right however, and they repeatedly find themselves subject to the wishes of those that surround them. When it is the wishes of a snotty poodle, a boy crazy sister, and the oldest, meanest woman in New York City that are responsible for transporting you through space and time you never know where you will end up. Aaron and Josh must find a way to return to current space and time, fix the machine, avoid the bullies whose underwear they stole, and catch the Watcher, who has been tracking their every move...