Disclaimer: I am an Expert Soccer Mom

Sounds like you have figured out the chemise back. Yes, most of the extra fabric from the T is cut off, the T closed by a run&fell seam, and the fullness gathered in & covered by a band.
I have done this prior to the sleeves and
definitely prior to the neckband! Your chemise will look just like the drawing when you're finished.
Jean
Route 66