Pat

[Pat Johnson]

When patters instructions  say, Ch 3, dc in each st around. Working (dc,ch3,dc) in each ch-2 sp around, 

Does  this mean  dc in st around, and then working  (dc,ch3,dc) in each ch  2 sp around ..again.?

[Granny Square]

Welcome Pat J.  I am pretty sure you are asking 2questions, picking 2 pieces out of the pattern, and that what you typed is not 1 line's instruction (because it  does not make sense, it's 2 conflicting instructions that are performed across an entire row or round, you can do one or the other, but not both)

"Ch 3, dc in each st around" --  I am 99.9% sure the chain 3 is the 'turning chain' which brings the yarn up to the level of the new round, and the thing you will be doing in all of the stitches is a DC.

"Working (dc,ch3,dc) in each ch-2 sp around," -- this line must NOT be in the line directly following the one above, because the above line only creates DCs, not chain-2 spaces.  The prior row to this line you quoted has to have spaces that are created by 2 chains.  When you work 'into' a chain space, typically you work around the chain space--you stick the hook under the chain, as if you were sticking the hook under the top 2 loops of a stitch, and form the stitches that way.  In your case only 2 DCs are worked around the chain, because for (dc, ch3, dc) the ch3 'floats' between the top of the DCs.