That's ok..there is nothing wrong with asking questions if a particular part of the process is confusing; many of us on this forum are willing to help, but we have to know where to start, right?
You are correct that you need to edit the php.ini file, and you can do it from the Linux ("Linux Is Not UniX" ) shell, but you do not have to. You can also download the file to your computer, edit there, and upload it back to Dreamhost. For many users, this is easier than coming to grips with a nix editor. I don't know what platform you are using (Mac, windoze, etc.), so I can't specifically address that process, but just make sure that you use a "pure text" editor rather than a "wordprocessor". Ideally, it should give you the option of saving the file with "nix" style line endings, and you should do so. If you need an editor than can do this, there are many freely available on the web.
It may not seem to be "in your account", but you do have access to it. It can be a little comfusing if you are not used to nix file system organization. The "/etc/php/php.ini" is *above your user account in the directory tree, and is shared by all users. This is why you can't just edit it and go (your edit to that file would impact all users on your machine!) but have to, as described in the wiki article, copy that file into a place under your control (within your directory structure), edit that copy, and instruct the server to use your copy instead of the "common" one...that is what the wiki article is all about.
the php file is located at:
/etc/php/php.ini - and you can "view" it, from the shell, by typing:
cat /etc/php/php.ini follwed by "enter" or cat /etc/php/php.ini|less , followed by "enter", to view it a page at a time using the "less" viewing utility (for help on using that, type less --help , followed by enter.
Your directory structure should look something like this:
note that "/etc" and "/home" are at the *same level of the directory tree! the "/" indicates the "top" level of the tree!
(If this doesn't help you understand. you might want to take a break from this project and google abit for "linux directory structure")
The wiki tells you to create a cgi-bin directory within your "web" directory, and when you do, it's path will look like this:
The update-php.sh script in the wiki article first copies the php.cgi and the php.ini files from their "common" homes, then uses perl to modify certian aspects of the php.ini file.
Does this help at all?