I went and looked at the pattern. It is a little unclear on a couple of points.
But where you are now....When you are increasing for the gusset it sounds like all the extra stitches are being added to needle #2. There is the purl stitch, the 12 added stitches and the knit stitch right at the end of needle #2. You are supposed to move those 14 stitches to a holder. Then cast on 11. You never cast on on a holder as far as I know, so I am thinking you are supposed to CO these 11 at the end of #2, just saving the 14 on the holder to deal with later. (That is one thing that isn't clear, the very next part is decreasing the gusset and it doesn't say to put the 14 stitches back on the needle, but maybe you would need to.) Then you could knit the last of the new cast on stitches together with the first stitch on needle #3 like they said. Then knit the even round.