Disproving well-quasi-order by providing an infinite anti-chain
Your algorithm produces an infinite sequence of antichains whose size is unbounded. However, it doesn't produce a single antichain of infinite size.

It is perfectly fine to specify an infinite chain by giving an algorithm that enumerates its members, and even more complicated constructions are possible (e.g. the priority method). However, the end result of the construction should be a single infinite chain rather than a sequence of antichains of unbounded size.

I suggest taking a look at Higman's lemma.