I did steps 1 through 6 .
For step 5, my Libby app, as you correctly anticipated, did not have anywhere to sign in to an overdrive account. So I just added 2 library cards and my card numbers for them.
For step 6, one library did not have the "Or sign into your Overdrive account", so I searched for the smaller library and, happily, I saw the "Sign into your Overdrive account" text/button/link, which I clicked. I then typed in my Overdrive email address and password, and I successfully logged in.
I then went to the Libby app on my phone to borrow currently available books from both libraries. The books downloaded onto Libby on my smartphone. But when I then pressed the sync button on my Kobo Forma, neither book was downloaded.