To make a gap for the belly button I worked short rows during the first ribbing section with the smallest needle as follows:

Work in Rib as established for 4 rounds.

Next Row: (Work in rib to marker, work 13 sts, wrap and turn, work to beg of rnd) twice.

Next Row: (Work in rib to marker, work to 2 sts less than the previous row, wrap and turn, work to beg of rnd) twice

Rep the last short row until the st just after the marker is the wrapped st.

For the legs I used the smallest needle and picked up 38 sts—1 st in each BO and 1 st in each row.