My local Tandy dealer has proven quite helpful. She agreed with my assessment of steps 13 and 14 and sent a note to the designer. During these steps the following appears to occur: in step 13 the drawing is trying to indicate riveting of 2 gussets (each assembled in step 11, from 3 pieces) to each other, flesh to flesh, then being riveted to one edge of the "front flap" and "front". Step 14 a through c then shows tying the front flap, the gussets and front together and stitching the 2 gussets together.
What it fails to show adequately, but by careful examination "implies" in the side illustration, is that you would insert a "pocket" between the two gussets before stitching. While called a "pocket", in this case it appears to become an internal divider. The second matching piece, another "pocket" is tied on externally on the back and becomes an actual pocket.
Essentially, all of the pieces must be riveted then tied together in 4 layers, BEFORE stitching. This is not shown, unfortunately, until AFTER doing so in the instructions.
The internal divider is all but invisible in the illustrations. An exploded diagram would have made a huge difference.
As to the leather, others have had good luck. My top grain is lifting wherever the leather is being stressed by stitching.
After I learn to resize photos in picasa I will attach some