I've made a similar bag from that book too and I agree that it is totally flimsy that it can't hold anything well. May I know what is a chipboard? Does it help? Also, how do you make the handles stronger?
Chipboard is a really thin cardboard. It looks like this.
You can usually get this for free from any craft store that sells paper. Paper manufactuerers send it to help the paper stay flat in shipping. When I need some I usually just go to Michaels and look for it underneath their scrapbook paper. It's garbage to them but a purse saver to me!
Step 1: Knit your bag but don't sew the seam up yet (if you can help it. It's easier to work flat)
Step 2:Cut your chipboard to the finished shape of your bag.
Step 3: Spray the chipboard with spray adhesive and stick to the inside of your knit piece.
Step 4: Sew up the sides of your bag.
Step 5: Create the lining. I found it the easiest to just sew up three sides and finish the raw edges on the top. ( I used a serger.)
You'll need to do quite a bit of fussing to get the handles to fit, so don't bother trying to hem it properly.
Step 6: Fit the lining inside the bag, fold the edge under and towards the inside, and whipstitch the pieces together.
Step 7: Cut a hole to fit your handle opening, fold the raw edges of your lining under, and whipstitch the lining to the handle.
This technique is good for small bags, but I wouldn't recommend it for big ones. The end result is Very stiff. I'm sure it will relax with use, but any pattern that isn't really structured would look awful. You could try just reinforcing the handles with chipboard and lining and that would probably work too.