How to alter a pattern

I am currently working on a dress.  I am almost finished with it, should finish it either tonight or tomorrow, just in time to wear on Resurrection Sunday!
I love the pattern, but I needed to bring the neckline up and the hem down.  Most patterns will say "cut here to shorten or lengthen", but they usually don't say anything about bringing up the neckline.  I'm teaching one of the preteens at church how to sew and she kept saying she wanted the "square neckline" in the photo, but I had to explain with a gathered neckline (peasant style) that was not possible with bringing the neckline up.  
First thing that I did was measure how much I needed to bring the neckline up, I looked at the picture and put ruler where it looked like it came to then measured up the soft spot where my neck and chest meet.  (I don't know what that is called!)

 I needed to bring it up by 3 inches, so I set my ruler at the three inch mark.  Then I drew a line starting there and then just followed the curve until I met the shoulder.  Can you see it in the picture?  Since I would be putting elastic there it did not need to be perfect.

 Since I would be sharing the pattern, I did not want to cut the pattern out on the line.  Instead, I put my finger on the line and traced with my finger on top of the pattern, while I held my fabric marker under the pattern right up against my fingernail.

 I needed to add length to the skirt part also.  I held the pattern up and saw where it landed on my leg, then held my ruler up and saw how much more I would need.  I needed 6 inches, so I cut a piece of paper 6 inches and taped it onto my material.  Don't you just love that material?  I wish I had more of it, but it was clearanced at Wal-Mart and those two pieces is all there was when I tried to get more.

 My new sewing machine will also serge!  See that funny foot?  It is what does the serging in combination with a setting on my machine, it pays to read your manual!

 Can you see it very well?  The left side is zig-zagged before I read the manual and the right side is serged after I read the manual.  It's slow but looks a lot better!

 I still need to finish the sleeves and hem (I have a turquoise and black zebra stripe that I am using for that.  This was two quilt "kits" my husband picked up for me for $10 (6 yards of material) at Wal-Mart last year.)  The biggest piece is the paint splashes which is supposed to be the back of the quilt.  I'm going to use the leftovers for my Dresden plate quilt, but needed to make this dress and a skirt first to have the leftovers.

I'm praying that once I add the elastic to the casing that it will look better and not so baggie.  I'll post pics when I am done, if I have time I also want to make a matching headband.
If you do not understand any of my instructions, feel free to ask!
Update:  To see the finished dress go here:  http://missyscakesandaprons.blogspot.com/2012/04/wanna-see-my-new-dress.html
My husband sent me this picture saying it was me!  I would love to have some penguins, guess I'll just have to settle for my cats instead!

Happy Sewing!
Missy