1. Distributing Python projects is a bit frustrating, I agree. Luckily pip helps a lot, but only on Linux/OS X. Windows users unfortunately are penalized by the lack of commitment by Microsoft.
2. Your suggestion of "writing down" a procedure is good. In fact, for larger projects (e.g.
https://github.com/readbeyond/aeneas...ALL.md#windows ), I have done it. There are project-specific steps to consider, though. Perhaps some Window user should put online a generic guide. I do not use Windows, so I am not the best candidate for writing it.
3. The dict.dz / dict.gz thing seems to be Windows-specific. In fact, a .dz file is a GZIP file, with special headers. Any compliant GZIP decompressor should be able to read it. However, for writing it one needs a "special" compressor.
4. "im not sure my dictionary is working" => see
https://github.com/pettarin/penelope#kobo-devices , open an ebook, and make sure you select a word that is in the dictionary (otherwise, you are not testing anything!), e.g. a common word. If that does not work for you: "write me an email, I will send you the Kobo file back".