Step 3: Scan or photocopy your logo
My suggestion is to scan it to a computer, if you don't have a scanner take it to Kinko's they will scan pics and drawings and put them on a flash drive for you. Getting your design on the computer will allow you to use it in a variety of areas when marketing your logo. However you can always skip digitizing and simply move on the tracing your design to a stencil blank.
Alternatively if your just looking to make a stencil you can reduce or enlarge the size of your design using a basic copy machine to get the exact size you need for your project
I won't get real detailed with how to use illustrator, however needless to say any program with a live trace tool is a hand drawing to digital scanning must for getting a good vector object that can be manipulated easily. Live tracing is a very simple tool that converts a drawing to a vector object that gives a much cleaner and harder edge to your design.