Help with "Tea and Sympathy" Shawl

Has anybody here made Lion Brand’s “Tea and Sympathy” shawl (the knitted version)? I have a question about the pattern that makes no sense to me.

There’s a text box that explains the “lacy pattern” used in the shawl, all of which makes sense to me:

LACY PATTERN
Rows 1 and 2 Knit across
Row 3 K each st wrapping yarn around needle an extra time.
Row 4 Dropping one loop of wrapped yarn from previous row to make a long dropped stitch, k each st
Repeat rows 1 – 4 for lacy pattern.

But later on in the pattern itself, it states:

With A, cast on 10 sts. K one row. Row 1 of lacy pattern K1, m1, k to last stitch, m1, k1. Continuing to work rows 1 – 4 of lacy pattern and inc in first and last sts of rows 1 and 2, work until A yarn is finished. Fasten off.

So now, I’m confused. Is the “lacy pattern” working row 1 as the “K1, M1, K to last stitch, M1, K1”, or is it “knit across”, as described above? Or, do I do the K1, M1, K to last stitch, M1, K1 row, and then rows 1-4 of the “lacy pattern”? :shrug: I know there has to be increases somewhere in the pattern because you knit from the bottom up, but where does this increase go?

You make the increases on rows 1 and 2 of the lacy pattern as it state:

inc in first and last sts of rows 1 and 2

You knit all other stitches on those rows,

sue

I don’t know the answer, but I’ll bump this for those who know more.