Joshua11,
Yes, you need to cut the slots in the middle of the control surface and in the trailing edge of the surface that it mounts to. You need to cut the slot deep enough for the hinge to be able to be pushed all the way into the slot. After you have the hinge cut to shape you need to draw a line across the hinge in the middle of the hinge. You'll want to push a pin through the hinge on this line. Then you can push the hinge into slot up to the pin. If it won't go all the way into the slot up to the pin then you don't have the slot cut deep enough. Take a look at the attached pictures and you can get a better idea of how the hinges should go into the slots.

As for cutting the slots. I could re-explain it here, but I have a very good section about cutting hinge slots in my LT-40 build thread. You can find the section I am referring to here:
[link=http://www.rcuniverse.com/forum/m_3439708/mpage_8/key_/tm.htm#3527542]Pay It Forward Build Thread!! LT-40 build. Cutting hinge slots.[/link]

Take a look at these resources and see if they don't help you out. If not, please let us know and we'll be more than happy to try to get you more help.

Hope this helps

Ken