question about pattern stitch

[Cherinec5]

hi everyone, i want to make this for my cousin for her birthday but i am having trouble understand the pattern. i am a fairly new knitter and only know the basic. can anyone please explain the stuff in bold to me????

Row 3: K2, * k1, (knit, purl, knit) all in yo, rep from * to last 2 sts, end k2.

PONCHO
Section 1: With circular needle, cast on 76 sts. Work even in Pat St until piece measures approximately 21” from beg. Mark end of last row. Work even until 48 repeats of Pat St (a total of 144 rows) have been completed. Bind off all sts.
Section 2: With circular needle, pick up and k76 sts along right edge of Section 1 from cast-on edge to marker. Beg with Row 2, work even in Pat St until 48 repeats of Pat St have been completed. Measure 21” up from bound-off edge along right edge as it faces you and place marker.

[Ingrid]

k1, (knit, purl, knit) all in yo, rep from -- In the previous row you made a yarn over stitch. On this row, in that stitch you are going to work three stitches. Knit, but don't slide it off, bring the yarn forward between the needles and purl into the same stitch without sliding it off, and then bring the yarn back and knit into it again, finally sliding it off.

After you do the first section, you'll pick up and knit stitches along the edge to make the next section.