I don't know how some of these yarn companies set the yarn thickness. Lion One Pound says worsted weight, but it's more like a sport weight. Knit Picks Wool of the Andes was supposed to be a worsted weight, but ended up being a light worsted weight, whatever that is. It's more like a sport. I grabbed two Red Heart Supersavers the other day. Both worsteds. The solid color is thicker than the variegated. Sheesh! All I can say is, you've got to swatch, swatch, swatch anything you're not familiar with.
The needle you use depends on if you're a tight or loose knitter. The general range in this pattern is #6-8 needle depending on your personal gauge. I did notice a problem with this pattern also. I would say to only do one straight stockinette stitch row after each decrease rather than the two called for in the pattern. Mine turned out rather tall and pointy like an elf hat.
Welsh corgis are cool.