I think the very first thing we need to do, if we ARE going with the VIC cypher, is to determine a key phrase that uses the 8 most common letters in the English alphabet–E, T, A, O, I, N, S, R–and has two indicated spaces.
This will give us a key phrase needed to put together the straddling checkerboard. For instance, a possible phrase from the Code C message would be:
“A vIcTOR ExteNSion” = A ITOR ENS would be the checkerboard key phrase
EDIT: Another nod to the VIC cipher is the arrows at the top–when you sequentialize prior to the transpositions, you are supposed to read the code downward starting from two points. The more I look at this, the more I think that perhaps the last “third” of the message is the actual finished product, and the first two sections are the steps Stormseeker took to come up with the final code. In other words, the code in its entirety is showing part of the encoding process, and the third section is the final product. In a sense, that would be the part that needs decoding. I’m doing this all with paper and pen, so we’ll see what I can derive if part of the encoding process IS included.