I have solved every clue, and have the appropriately punctuated message.
I have found five (all 8-letter, because I was only looking for those) 'variations of 7' whose creators' first names appear in the grid.
B__, V__, P__ all fit at 1ac; another B__ (whose first name is the diagonal one), and an A__ (whose first name is the horizontal one) do not fit and seem likely to be irrelevant.
Now I must apply the second sentence of the preamble. I suppose I must treat the unnumbered entry as being the result of
using an unspecified number of those techniques on a word, and reverse the process. (Though I find 'used' rather than 'you must use' confusing).
I cannot tell from the instruction how many operations I should carry out, or in which order - possibly two, but possibly more with the whole process carried out twice.
I understand that a common K__ fits at 1ac. Contrary to above comments, I cannot interpret the instructions in a way that further narrows down the possibilities for the K__ beyond what fits at 1ac. That is a very long list of words.
There seems to be too much uncertainty to start trying options.
Am I misinterpreting the instructions?
(I have scanned the list of words (also a very long list) that fit at the unnumbered entry and know by association what goes there, its number, the next member of the set, and where that goes. That does not encourage me to start experimenting to fill in intermediate steps)