The instructions for Step 7 are a little simplified, to say the least. Place the moving blade carefully over the plastic part with the flat side upwards, then place the fixed blade over it with the flat side downwards. Take care that the plastic part is engaged with the moving blade when tightening the screws - it's very easy for it to be dislodged. It's best to tighten the screws loosely first, tight enough to allow you to adjust the fixed blade so that the teeth of the two blades are aligned. My clippers have a lever which allows the relative position of the two blade to be changed, and I move the lever to the extreme forward position, then adjust the position of the fixed blade till the teeth are level with the teeth of the moving blade. Tighten the screws and view the blades side on to make sure the plastic part is still engaged with the moving blade - if not, loosen the screws enough so you can engage it. You shouldn't be able to see it when the screws are fully tightened.

Yes, there are two blades. All the photographs show the fixed blade. The photograph in Step 2 shows the white plastic part which is where the moving blade goes. My clippers have a black part but the idea is the same. This part drives the moving blade from side to side to operate the cutters. Sharpen both blades the same way as shown for the fixed blade. The instructions don't say to wet the sharpening stone but you should do - I spit on it but you can use oil. Clean and dry the blades after sharpening. I prefer to oil them afterward re-assembling the cutters to avoid messy hands.

See Step 7 for my comment on re-assembly - not enough room in this comment.