Try this:

1) Backup your skin files from the \Portals\_default\Skins\NAME folder  (always a good idea when someone says 'try this' ;D )
2) Edit the ASCX to where the jQuery is functioning correctly
3) Delete the HTML to prevent re-parsing
4) Host > Extensions
5) Find your skin, click the "Edit" icon (blue pencil) next to it
6) at the bottom of the page, select "Create Package"
7) follow the steps provided
8) Retrieve your fully formed Skin Package from the \Install folder, or wherever you tell it to place the file during package creation

This should create a fully formed and manifested skin package with the ASCX file.

When I started, I too used the HTML->ASCX conversion method but since 5 came out, I've been pretty much only working with ASCX files. Once I got my head wrapped around the basic concepts (a lot of thanks to Lee Sykes at DNNCreative.com), I actually found this method to be easier and it lets me see my changes real-time. However I do see you're a novice so it is best to 'settle in' to where you're comfortable first. I do reccomend a subscription to DNNCreative as they have a wealth of tutorial videos that I've found indispensable for helping me get deeper into working with DNN's many facets.

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Wells Doty Jr
Online Content Development