OMG, I am such a doult!! I HAVE this pattern booklet - it came with a british magazine.
OK, flip back to page 15 - under Abbreaviation it defines ML, which appears to be short for Make Loop. It doesn't actually say to be using the kid silk haze here, but it has to be what you're using. It also doesn't tell you to string the sequins onto the KSH, but again, you would have to string at least enough for each row.
Back to the skirt directions, don't confuse row 5, where you m1 (make 1 increase) with row 7 where you start using the ML (make loop).
Again, it's not clear if you are holding the 2 yarns together across the row, but you'd have to be. When you get to the ML on row 7, you will do this weird stitch every other stitch across the row. Knit the next sitch but don't slide it off the left needle. Bring the KSH to the front between the needle tips, bring forward one sequin, wrap the KSH around your left thumb and then to the back between the needles. knit into the same stitch again and slide both stitches off the left needle. It says to cast off one of the 2 stitches on the right needle, I'd think of it as a pass stitch over, well, I guess that is a bind off or cast off. It's not relaly a PSSO since you don't have a slipped stitch.
THen you knit 1. Then you do the whole ML thing again. Every other stitch across the row.