We have a sequence of maps
$$f_i:\ D_{i-1}\to D_i,\quad z_{i-1}\to z_i\qquad (1\leq i\leq 5)\ .$$
Here $z_i$ does not denote a certain point in the $z$-plane, but the coordinate variable in the $i$th auxiliary complex plane. $Z_0:=\sqrt{2}-1$ is the $z_0$-coordinate of a certain point $Z$ we are interested in.
$D_0$ is the unit disk in the $z_0$-plane minus the points $z_0\leq0$. The map
$$f_1:\ z_0\mapsto z_1:={\rm pv}\sqrt{z_0}$$
maps $D_0$ onto the right half $D_1$ of the unit disk in the $z_1$-plane. Thereby the point $Z_0$ is mapped onto a point $Z_1\in\ ]0,1[\ $.
The Moebius map
$$f_2:\ z_1\mapsto z_2:=-{z_1-i\over z_1+i}$$
maps $i$ to $0$ and $-i$ to $\infty$. Furthermore $f_2(0)=1$, $\ f_2(1)=i$. From general properties of Moebius maps it then follows that $D_2:=f_2(D_1)$ is the first quadrant, and that $f_2$ maps the real axis onto the unit circle. Therefore $Z_2=f_2(Z_1)$ is a point between $1$ and $i$ on the unit circle.
The map
$$f_3:\ z_2\mapsto z_3:=z_2^2$$
maps the first quadrant $D_2$ onto the upper half-plane $D_3$, whereby $f_3(1)=1$, $\ f_3(i)=-1$, and the quarter unit circle in $D_2$ is mapped onto the upper half of the unit circle in $D_3$. Therefore the point $Z_3:=f_3(Z_2)$ is lying on this upper half of the unit circle, too.
The Moebius map
$$f_4:\ z_3\mapsto z_4:=i{z_3-i\over z_3+i}$$
maps the upper half plane $D_3$ onto the unit circle $D_4$. Thereby $f_4(-1)=-1$, $\ f_4(1)=1$, and the unit circle of the $z_3$-plane is mapped onto the real axis of the $z_4$-plane. It follows that $Z_4=f_4(Z_3)$ is a real number between $-1$ and $1$.
Doing the calculations $Z_4$ should simplify to an expression defining a real number $\alpha\in\ ]{-1},1[\ $. Letting
$$f_5:\ z_4\mapsto{z_4-\alpha\over 1-\alpha z_4}$$
you finally arrive at the required map
$$f:=f_5\circ f_4\circ f_3\circ f_2\circ f_1\ .$$
Best Answer
The first three steps from solution in a comment are fine:
Use the map $z\mapsto z^2$ to send $\{|z|<1 : \operatorname{Re} z>0\}\setminus [0,1/2]$ to $\{|z|<1\}\setminus [ā1,1/4]$.
Then use the map $z\mapsto \dfrac{zā1/4}{1āz/4}$ to send it to $\{|z|<1\}\setminus[ā1,0]$.
Use $z\mapsto \sqrt{z}$ to send it to the right half disk.
I think $\dfrac{z-i}{z+1}$ has a typo: should be $z+i$ in the denominator. Easily fixed. Anyway, my preference is to use the Joukowski map $z\mapsto z+z^{-1}$ for half-disks. It sends the upper half of the unit disk to the lower halfplane, and the lower half-disk to the upper halfplane. So, the remaining steps can be replaced with $z\mapsto -iz$ followed by $z\mapsto z+z^{-1}$.
This is correct.
Exactly what you used: a combination of square and square root maps that "push" the slit back into the boundary from which it sticks out.