They're twisted sts. This part -
"Using B, * insert the tip of the right hand needle through the first stitch as if to purl, knit the 2nd stitch and leave on the needle, then knit the first stitch through the back of the loop, slip both stitches tog from theleft hand needle; rep from *" - means to put the R needle into the first st as though you were going to purl it, but twist the needle to knit the 2nd st, leave them on the needle and knit the first st through the back leg. That completes the stitch.
The next part -
"k1, *knit 2nd st through first st, then knit first st in back of loop as before; rep from * across row to last st, k1."
- is the same but you do a k1 to begin the row.
sue- knitting heretic