The wing is sheeted with balsa from the leading edge back to the spar - about one third of the chord of the wing. So the instructions are trying to tell you that the spar is at the spot on the wing where the balsa sheeting ends and the open covering begins. Your ideal CG location is just behind the spar. Does this help? In other words, feel the underside of the wing out at the wing tip. starting at the leading edge run your finger along the underside toward the rear of the wing. About one third of the way back, you will feel the transition from solid balsa sheeting to just covering over air. At this point, you have found the rear edge of the spar. the CG is 1/8 behind that point.