I just started my level I swatches and since I've had no luck with steam blocking I soaked my garter and rib swatch. I am using 100% wool and the swatch stretched! I squeezed out the excess water in a towel and left it flat to dry. I didn't pin it, and it remained stretched out. Has anyone else had this problem?

Yes, many times. It happens to some yarns more than others. Superwash is terrible for growing in the water. It is one reason to always knit a gauge swatch AND wash it before you begin a project.

Luckily for me, when I was starting Level 1, I soaked and blocked my very first swatch. After that I ended up switching yarns to something that was not so affected by the soak.

My experience is that wool should be pinned for blocking. You didn't mention what brand of wool you used, but if it is this new Superwash wool, it won't behave like 100% wool.

Some people notice that their knitting grows when they wash it, which is one of the reasons to swatch before knitting a project. You may have to use a smaller needle in order to end up with a washed swatch that has the correct finished dimensions. I haven't noticed that superwash stretches out when it's washed so much as noticing machine washing something made with superwash wool helps it to get *back* into shape after being stretched out from wear (like with socks -- I machine wash those and then every so often I'll toss them in the dryer because they've stretched out too much.)

I don't recall needing to pin the garter swatch, just patting it to fit the lines on my blocking pad, although I might have pinned the corners to make sure it would be nice and squared off when it was dry. It certainly didn't need the same sort of care as blocking the swatches that had stockinette edges.

Thanks for the advice. I'm using EXTRA 100% wool and it's shrink resistant. I've knit many things with it but have machine washed and dried it and didn't notice the change in gauge. I rarely block my garments, so this is the most challenging part of this program

The fact that it is labeled as "shrink resistant" and that you can machine wash and dry it suggests to me that it is indeed some sort of Superwash wool. As I mentioned earlier I have found that superwash tends to relax and expand when wet.

When I encounter this sort of problem with yarn that I really want to use I skein it, wash it by hand, and hang it to dry. After that I don't have any problems with it expanding or changing gauge when I knit with it and/or block it.

Mariel,
I just had a thought here. If I remember correctly, you are supposed to block your swatches by whatever method that a yarn calls for. In other words, rayon or acrylic wouldn't be wet blocked by soaking and pinning out, and cotton would be handled differently also. So maybe you should be "blocking" by machine washing and drying your swatches. Of course, you still have to find a way to deal with the inevitable curl of stockinette. Remember that in the instructions, they said they recommend wool, but you don't have to use that. So Superwash and shrink resistant wools wouldn't be exactly the same as regular wool, so don't treat them the same way.
Diana