Slip one means to pass the stitch unworked from the left needle to the right needle. PSSO means to pass slipped stitch over. So in this case
(and this is a very common combination of procedures) you would slip one st from the left to the right needle, knit the next 2sts together and then take the slipped st which is sitting on the right needle, bring it over the st on the right needle nearest the tip of the needle (the st formed by the k2tog) and let it drop off the right needle. You'll be decreasing 2sts (but increasing 2sts with the YO's).
For the even number nows which are the wrong side, just switch the needle from your right hand to your left hand when you come to the end of the previous row and work across the even row in purl.
Best not to give the entire pattern, just the relevant rows due to copyright issues.