How can a YAC be screened against a cDNA library and a cosmid library of genomic DNA to find a gene?
The YAC contains a segment of chromosomal DNA. By using it as a probe they could screen the cDNA library to find cDNAs derived from that genomic region. This would be done by plaque or colony hybridisation. The cDNA clones thus identified represent the "candidate genes" . 

The last step is a little unclear. Clearly they are identifying cosmid clones that map to the segment of interest, but they could be using either the YAC or relevant cDNA clones (could be pooled for this step depending upon their aim) as probes. My guess is that they used individual cDNA clones to find corresponding cosmid fragments so that they could home in on the regions encoding the identified cDNAs.