Not reading the pattern I will tell you what I think it is asking you to do....

Row 2, when it states "repeat from * to last 2 sc, it means stop the pattern when you come to the last 2 sc's. In the last 2 sc's you would do a decrease. You would start your single in the next sc by inserting your hook in the next to last stitch, yo (yarn over) and then pull your yarn up through stitch, then start your single in the last sc by inserting your hook, yo (yarn over) and then pull your yarn up through stitch, you will then have 3 loops on your hook, yo and pull yarn through all 3 loops, (You have now decreased a stitch)

Row 3: You will have 2 loops at the top of every sc you made. Insert your hook under both loops.