In Norwegian style knitting you hold the yarn (sometimes several strands of different colors) stretched over an outstretched index finger on the "from"-needle hand (left for me, but I guess if you're knitting left-handed it might be the right). With the "to"-needle you kind of crochet each stitch by hooking the needle around the the yarn from the front or back (depending on whether you're doing a k or p stitch) and pulling through. I've never really mastered this and knit the way I learned in the States just 2 sweaters before my first visit to Norway -- i.e. holding the yarn in my "to"-needle hand, steadying the needles together with the "from"-needle hand mid-stitch, then wrapping the yarn around the needle with the "to"-needle hand before pulling it through the stitch. People who have mastered the Norwegian style are much faster than even masters of the US style. There's also a French style, I've observed, where the "from" needle is kind of planted under your arm. French knitters are super fast at that.

But back to the original question -- go ahead and scrunch the stitches together. And it doesn't matter whether you tend to knit tight or loose. Just be sure to knit up a test patch and check how many stitches and rows you're getter per 4x4-inch block, or however they state the gauge in the pattern (stitches per 10 cm, stitches per inch, inches per x number of stitches, or whatever). If your stitches are smaller than the pattern is based on, then try a larger needle until you get the right gauge. If they're bigger, then try a smaller needle. That way your knitted product comes out in the size and tightness of weave the pattern illustration has led you to expect.