First, congrats on trying to do your next big project!
Yes, since you are working these flat, rather than in the round, you will need to knit one row then purl one row to get St st. By knitting each row you get garter st.
To make them smaller you can
1) overlap the seam as you said, but this may create a bump that rubs. It will also require you to knit the other one in garter stitch so it will match the first one.
If you are willing to redo the first one then you could
1) CO fewer stitches, based on your gauge, to get the width (circumference) you want.
2) use smaller needles, which will create a tighter weave and narrower leg warmer.