YPOPs itself can't to the forwarding. YPOPs is a middle man program that lets a desktop mail program such as Microsoft Outlook, Outlook Express, or Mozilla Thunderbird download mail from your free Yahoo mail account to your computer.
What program are you using to download the Yahoo mail with POP3? This is the program that you created a new account in and pointed at the mail servers 127.0.0.1 in the YPOPs directions. In that program you will need to create a filter or rule to forward all mail it has downloaded to your Gmail account. If you let me know which program I can help create the filters/rules for the forwarding.
Create a filter in Thunderbird that forwards all e-mail to your gmail account.
Go to Tools and select Message Filters to create the rule.
If you do all of these steps, in this order, and leave Thunderbird running on your desktop, you should have a system in place that is able to forward your free Yahoo mail account to your Gmail account.
Maybe someday Yahoo will let free accounts forward their mail for free.