Clarification of terms used in Arduino.

The Arduino-0012 setup should be self-contained and has all the avr tools built-in for its own use.

Start the Arduino program.

If you copied the "Blink" sketch as a bit of text from the webpage, then just paste that into the big white open window, and now you can save it as a sketch on your computer.

If you downloaded a .pde file, which represents a packaged sketch, use the Arduino environment's "File > Open..." menu or the "Open" button on its toolbar. Then find and select your .pde file.

I find this a lot more reliable than depending on your OS's guesses about which applications are for what files.