This pattern is a worsted version of an infant pod/cocoon I designed in bulky yarn several years ago. It is a great last minute gift for a new baby or baby shower and knits up very quickly. I used Valley Superwash, but Malabrigo Worsted would also be a very nice choice to knit this pattern in.
The gauge is 20 st/24 rows = 4”/10cm in the knotty pattern stitch using sz 8 needles and 20.57 sts/26 rows = 4”/10cm in the knotty pattern stitch using sz 6 needles. Check your gauge. It is more important for the gauge to be correct than it is to use the same needle sizes. People knit loose, tight and average. Your needle size may be up or down a size or two from mine. Just remember that the two needles sizes you are using should be about 2 sizes different, i.e., if your needle size for the pod is sz 9, then your hat should probably be a sz 7