Begin on wrong side of row, work 2" in stocking stitch (measured from bound off stitches, )ending with right side facing for next row.
It may be a case of a misplaced parenthesis or two. What it means is to work in stockinette for 2" measured from the bound off sts. Usually with dog sweater patterns you work each area, the 11sts, the 80sts and the last 11sts at the same time with 3 separate balls of yarn. After working 2" you end with the right side facing and knit across with only the first ball of yarn, casting on 11sts at the places where 11 were bound off. That makes 2 small open squares for the leg opening and joins the 3 sets of sts.