I have some questions. What will the finished size of the block be? Is the 16x16 piece of fabric the background or is it supposed to be included in the house? And how does she expect you to add people, trees, pets, etc., without appliqueing them on? I suggest you call this lady or someone in the group you are comfortable with and get more information. You say you are a fairly new quilter, so I'm sure they will be more than happy to guide you.