A steek is essentially a strip of knit fabric that bridges the patterned parts. Once the knitting is done, you cut down the middle of the steek and fold the cut edges under. It can be a little disconcerting to take scissors to your knitting, but if you do everything correctly, your sweater won't unravel.
In my case, when I got to the end of the first row of the colorwork yoke, I used the two strands then attached to my knitting to cast on 10 stitches at the center front (where my button bands would later be). I placed a marker on either end of these stitches to help me keep track of where the patterned stitches ended and the steek stitches started. For every round involving two colors, I simply alternated the two over the 10 steek stitches. Once the colorwork section was complete, I bound off the steek stitches and finished the rest of the neckline working back and forth.
Then the fun began. Because my yarn (Berroco Vintage) is mostly synthetic, the strands of yarn were not going to hold together on their own and wouldn't be able to felt over time (which is what happens in many steeked garments). This meant I needed a strong way to secure the steek stitches -- my sewing machine.
First, I got my steek ready by weaving in a piece of contrast yarn to show me where the center of the steek was (this would be where I would cut after I'd done by sewing):
The lighting is bad here, so the colors are off, but if you look closely you can see that I have two lines of stitching on either side of the pink yarn marking the center. You really only need one line of stitching on either side, but as it was easy enough to do two more, I thought I'd be extra careful. You'll also notice that the stitching isn't pretty, and it doesn't have to be. The key is to get the thread to pierce the yarn strands, thereby locking them together.
Once the steek was secured, I removed the contrast yarn and started cutting down the middle.
After just a few cuts, I had a cardigan!
The last step was to fold the cut edges under and secure them to the inside. This isn't as necessary with an all-wool yarn, as eventually (with wear) the facings will felt to the inside of the sweater, but I needed to do it on this sweater to keep the front looking neat (and to keep it from toddler fingers!).
Ta da! The scary part is done! All that's left after this is to pick up the stitches for the button bands. Now, that wasn't so scary, was it?