I had the same concerns when I had to cut my hose to insert the water trap (both Badger), but trust me... it's not that difficult.
Step 1: cut the hose; I used scissors but I suppose a sharp knife would do just as well. You want the cut far enough from the compressor that the water has a chance to condense, but not so close to the brush that it will interfere with painting: 18-24" from the hose-airbrush connection is usually recommended.
Step 2. Put one nut on each half of the hose so that the threads face the cut edges.
Step 3. Insert the nipples on the water trap into the hose (I don't remember if it has to go on in a certain direction, so check to see if there are any arrows or notations (i.e. air-->)). Use the nuts to tighten the hose against the nipple. You're done.
Hope this answers your questions, and good luck.