i saw video of paul gilbert demonstrating string skips and than the guy asks him does he use inside and outside picking, or something along those lines, anyone got an idea what it is
its what it sounds like...

pick the low E string with an upstroke,
then pick the A string with a downstroke
therefore you're picking on the inside, then on the outside of the string.

feels weird and hard to do quickly, but worth practicing.
I never understood why this was hard for people. For some reason, when I was beginning alternate picking, I had a worse time with outside-outside picking. Maybe it's because I'm left-handed, but play right-handed? Doubt it but anyway, I personally found it easier to skip strings "inside-out" in the beginning, but after lots of practice, they both feel natural. Like Freepower said, it's how you'll move from string to string half the time. You can't always play/write songs that strictly allow you to pick outside to outside. Shrug.

well it's 'hard' ..moreso just uncomfortable because with the first upstroke, you move the pick away from where it needs to go next, and its just odd.

for practicing it, aside from dull excercises,
i'd try the main riff from cowboys from hell
guitar world had a good transcription/talked about this technique a little while ago...
There's 3 ways you can move from string to string:

1) Inside pick
2) Outside pick
3) Direct (economy) pick

The first 2, are really important because you have to do them in a lot of
situations. Direct is the most movement efficient, but not always desired.

"Speed Mechanics for Lead Guitar" talks about the 5 cross string picking mechanics,
but it really only boils down to those first two.

I'd suggest focusing on stuff that works specifically on all those individually. I like
doing 4ths for that, but anything that goes back & forth between two strings will

Usually people will find either inside or outside easier to do, so pay really good
attention to the one you're weaker at. It is possibe to get them both to the
same level.
PG does outside picking so he can do his string-skipped arps without hitting the strings inbetween.
eg pick 9 on 1st (thinnest) string with an upstroke then pick 14 on 3rd string with a downstroke.