There is no reason you should be feeling dumb. I too had difficulties with measurements when I started dieting and losing weight. I guess that's pretty normal.
I asked a friend of mine this question once and she taught me what her fitness trainer taught her--which is to take the measurement well below my rear end or wherever the widest point lies. Actually, the right way to measure the hips varies from person to person. But for us who store excess weight in our hips, taking our measurement around the largest part of our buttocks is the right way to go. It would also be best to try to do it in front of a mirror to make sure that the tape is level all the way around.
Hope this helps.