Well, I guessed that it might be a mini-curtain. Is it supposed to refer to the 'man behind the curtain'? 'Cuz he's not exactly hiding The Bug behind it as he infers. That's why I wasn't sure of my guess, it's not big enough to hide much of anything.

I dunno, I kind of thought it looked like he'd taken up mini-knitting... LOL

Well, Torg says "don't look behind the curtain", so there needs to be a curtain. He wouldn't want to get the question "What curtain?" and not have an answer. And he says there's "a small insect" behind the curtain, which it's big enough for. Actually hiding anything isn't the point, obviously.

Oh god! The time travel bits! SOOOO confusing.