Is there a way to make this all work using Ken's instructions?
Sure, Ken's library is the software. It doesn't mind whether the hardware is hanging directly off the pin or amplified with a transistor.
This protoshield looks infinitely easier than the circuit so if I can get away with the easy/lazy approach for now.. would I just need a smaller LED and a smaller resistor?
The easy/lazy approach is to limit the current to 20mA and do away with the transistor. Then you just connect up the LED and resistor directly to the Arduino pin. Assuming Vf is 1.5V or so I'd use a resistor of (5-1.5)/0.02 = 175 ohms or so (180 ohms is a standard value).
T12 & 13 etc are transistors... but what kind?
T12 and T13 are just testpoints

You can ignore them. They are on the
Gadget Shield so that students can use it as a learning tool to see how transistors/LED's/etc. operate.
LED 6 - is that the part number underneath it?
Indeed it is.
R22 & R23...one says 100 and the other "DNP"... not sure what this is?
DNP means "do not place" -- the part is not on the board by default. It allows people who want to crank up the current a little bit to put another resistor in parallel without having to desolder the existing 100 ohm resistor. You can ignore it as you'll just be swapping resistors in and out.
is there anywhere that explains what this all means?
Beginner's books on electronics! I don't have any specific recommendations but I know this question comes up in the forums regularly so a bit of hunting around might lead you to some recommendations.
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The
Flexible MIDI Shield: MIDI IN/OUT, stacking headers, your choice of I/O pins