Yes, it is a foreign language, but once you realize what it's telling you, it makes perfect sense. Your second interpretation is right, and once you get going, the knitting will tell you what to do. Look at the results of the yo's and stitches, and later on, reading your stitches will come in handy.
Just remember to keep a yo,k before one marker and a k,yo after the marker.
"Trust the pattern!"
Time flies like an arrow, but fruit flies like a banana.
Hop aboard while we follow the cloud-covered van of knitting harmony, man!! Woooo!! --Hedgehog
IngridKH on Ravelry