Charerg has explained the method perfectly, just follow the steps and you'll be fine. Generally speaking, I think most people find working with the equirectangular projection as their source map easier despite the distortion (though there are ways to circumvent that), due to the fact that you are basically painting on a rectangle with a 2:1 width to height ratio. Less chance of messing something up that way.

Things are looking good so far with your map, can't wait to see where this is going