I emailed Jen and she replied with some very good info that might help Hazel out too, so I'm going to copy and paste the email here.
[[That's alright, you've just been distracted by the increase method info. Here's how this is supposed to work:
FIRST Read through the increase instructions and decide which one you want to do. Then go to after the increase methods to resume the pattern, which refers back to those increase methods.
The pattern resumes here:
Left Shoulder shaping (apply chosen method as above)
RS rows: Inc 1 at beg of row only while work in lace patt.
Rep until piece measures 9 (9.5, 9.75, 10, 10.5) inches or 23 (24, 25, 25.5, 26.5) cm long and 8.5 (8.5, 8.5, 8.75, 9) inches or 21.5 (21.5, 21.5, 22.5, 23) cm wide with 7 (7, 7, 7.25, 7.5) lace repeats. All sizes end with a RS row—54 (54, 54, 57, 60) sts
Left Gusset and Shoulder Shaping
Do not break yarn. While casting on 25 new sts simple loop style at end of RS row, PM after the first cast on st, and PM before the last cast on st. You will pick up sts in this cast on row later. Gusset sts are knit plain while shoulder sts knit in lace patt.
Gusset row 1 (WS): K1, purl to end.
AND THIS IS WHERE YOU BEGIN INCREASING AT BOTH EDGES, WHILST ALSO DECREASING IN THE GUSSET:
For this section, inc 1 at beg of sleeve and inc 1 at end of sleeve; dec 1 at beg of gusset and dec 1 at end of gusset. For feather tip, refer to lace shaping guidelines for left edge (end of row). Stitch count remains the same for all rows, specifically: etc…]]
Hope that helps anyone else that's confused!