All you are doing is trimming off any poopy wool from their back ends. How extensive this is depends on how mucky they are, and on whether the muck is wet or dry.
First tip is - don't pull the wool, as this will cause the skin to 'tent' and you will cut through it.
Only cut where you have a clear view and you know you are not going to cut off teats, bits of vulva, penile sheath, tail etc.
For small lambs, using Swiss Army knife scissors can sometimes help where there is poop very close to the skin.
Don't think you have to do it one way because that's what you've seen - do it however suits you, your system and your skill level.
You might need to wash them afterwards with warm soapy water to get off wet muck. Nice clean 'rattly' dags are great to trim

It helps to have the sheep well secured. Some bits of dagging can be done with the sheep sitting on its bum, but other bits need it standing, so a halter or an assistant can be useful. Failing that, put the head in a corner, straddle the sheep facing backwards, gripping just in front of the back legs gently but firmly with your knees, and bend over to reach the tail etc
My computer died when I tried to send this, so here's hoping it's working this time...