Chapter 1 - What is Steampunk
"Steampunk is a hybrid, a blending of many bits and pieces of other genres to create a new genre."
"Steampunk falls under the major genre heading of Fantasy."

"Usually set partially within London, or totally within London, though there is nothing wrong with plunking it all down in Dublin or Edinburgh or Cardiff."

For my story, none of the locations are direct representations of places from real life, meaning that I don't have London in the concept for the story/game. Instead, however, the story/game makes use of a number of different levels in the form of islands. Although this isn't necessarily bad.

"An alternative universe or parallel world where steam power is still the preferred mode of energy and/or Victorian ideals or elements are prevalent is also an option - build the entire world to your specifications." 
This is what I'm likely to do, as the planet itself could be similar to Earth, as humans and creatures of (the actual) Earth inhabit the world of my concept, but the 'layout'/structure of the world will, of course, be different.

The book states some rules that steampunk stories should follow to be considered a steampunk story. Some of the rules stated are ones that I can follow, but some of them are ones that I won't be able to follow in the story.

"As steampunk stories are remakes, updates, reconfiguring, inspired by the first science fiction stories ever written, they need to be, in essence, Victorian. It doesn't matter where in the world or universe or alternative universe or parallel dimension they take place, the feel, the setting, is one with the Victorian world."
This is one rule that I may not be able to follow, as the setting of my story is a number of locations which (almost) all have very different settings to Victorian locations.

However, I intend to show steampunk within the game mainly with the use of the enemies and boats that are visible throughout the world. The enemies are mechanical sea creatures, and the boats are mechanical/steampunk styled.
"The story involves steam driven machines, clockwork mechanics, doing things hat similar devices were incapable of actually doing in the time period."
This is where I have tried to implement the steampunk theme into the game, as the enemies of the game, visual wise, look like normal sea creatures, but in terms of their bodies, they are mechanical and comparable to gears/clockwork.

"The storyline uses elements of magic or that appear to be magic (such as conjuring, sleight-of-hand, magician's tricks)."
One of the other rules stated is that some sort of magic is to be included, which is not apparent in my story/game.  I would like to follow these rules a bit more strictly than I have, but at this point in time, it's too late t make changes that are this significant. However, our game isn't strictly steampunk but needed to have sci-fi aspects, and that is why I decided to try and implement aspects of sci-fi (this being the mechanical ships/enemies).

However, at first, I was worried that the mechanical enemies and mechanical limbs of the characters (this being another concept I had) would not be fitting for the steampunk theme and that this wouldn't fir the overall sci-fi aspect of the game/story. But after continuing the read some of the rule stated in the book, this worry has somewhat dimmed down.
"Science is very much a part of the Victorian era, and thus beings created by science are welcomed in Steampunk tales. These can be robots, cyborgs, people with mechanical limbs, creatures built from spare biological parts..."