This is how it was worded, a bit confusing
1) Extract all .psarc's into the folder they are already in and then delete them on your HDD.
When you're done it should look like this:
but what I think it means is move the psarcs out of their folder (original game files) then delete them so all thats left in Game's USRDIR isthe files I just mentioned earlier. The use the USRDIR in fix and overwrite the Game's USRDIR files, then swap eboot.bin
PS3 Slim 4.21.2 Rebug REX 4.31 Spoof (external 1TB/3TB), PS2 Fat w/ Internal HD