You are correct (mostly)...
For Each Item that you enter into your Item List, you get 1 (and only 1) instance of it in the Inventory. It is either not in the inventory ($ITEMSTATEX = 0) or in the Inventory ($ITEMSTATEX = 1).
If you want multiple Icons of the "same" Item to show up in the Inventory, then you need to make Multiple clone entries of that same Item in the Item List (1 for each instance of it you want to show in the Inventory).
You could however, make one Item (Say SWORDS) and then set it to record how many of them a Player has - in other words, 1 Icon in the Inventory, that when opened, says "you have X number of Swords".
Using the later would be the easiest, but requires you to create a separate %Variable to keep track of how many Swords the Player has.