Yea you mis read it. It states:
"Now, go back to the feralheart folder then bring up your zip folder.
Drag the items.cfg into the Feralheart folder"
What they mean is, The zipped folder is what you just downloaded, those files are in a zipped file which means its in a compressed folder. And they say to drag the items.cfg into your FeralHeart folder. They dont say zip after it~ just do the following
items.cfg goes into your C:/FeralHeart folder
All The files in Item Folder goes into your C:/FeralHeart/Media/Items