Increase size x 8 and add grid.
Increasing Size:
Shift-s to resize the
picture. Resize to 800%, and use 'Pixel resize'.

The pixels/stitches are
now large enough to work with.

Adding a grid:
A grid that fits over a 128x128 stitch pattern can be downloaded here.
Open the grid picture, and
press + a few times to make the grid appear large.

Click on the magic wand
selection tool
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Click on a grey part of
the grid to select it.

Press ctrl-c to copy it.
Go back to the pattern now,
and press + a few times to enlarge it. Go to it's bottom right
corner.

Press ctrl-e to paste the
grid into the pattern, making sure that both the bottom and right
edges have a line resting against them.

With the grid still
selected, click on the 'fill' tool
, select grey from the palette, and click directly on
the grid to fill it with grey. Deselect the grid by pressing ctrl-d.
Scroll to other parts of the pattern to find any parts without gridlines. Repeat the Ctrl-e/fill with grey as many times as needed in order to cover the entire pattern. Always make sure new pastings of the grid overlap and line up perfectly with the already existing grid lines.
Here's the fully gridded
pattern.
