The 3 1/2" Lil twister template you ordered calls for 5" squares so your blocks may not be big enough.
I would recommend you look through the twister topics and figure out how to make a 3" twister. They would probably work with 4 1/2" squares. Make your marks at 3/4".
Here is one with lots of info:
http://www.quiltingboard.com/t-57130-1.htm
Be sure and read page 6.
good luck.