Do this for the entire length of the strip, and then repeat to fold the other side down. What you'll end up with is this:
Press flat with your iron, and then fold the bottom side up to meet the top side, and press:
From here, you'll place the bias tape onto the 17.5" edge of your backing pieces as shown:
Stitch close to the edge, and make sure to catch the back of the tape as well!
Since you've got two backing pieces, make sure that you are stitching one edging to the left of one piece, and the other edging will go on the right side of the other. These are the edges that will be exposed.
Next, we'll lay our front piece right side up as shown:
and take your first backing piece and lay it right side down on top of your front piece. Pin around, leaving the exposed edge open. For the purposes of this tutorial - the edge that will be primarily shown on my finished pillow is the solid RED edge. Make sure that the first piece you lay down is the one you want showing. If you've done two different tape edges (maybe you ran out of red fabric, like me, and had to improvise?), or perhaps your stitching went a little wonky on one - the one you lay first is the one that will show.