by that documentation, then your %QSCAN breaks down as:
argument is %qsysfunc(dread(&did,&i))
n is 1
charlist is .
there are no modifiers to the %QSCAN
You can look up what N is in the documentation for %QSCAN. Basically, &FNAME will be set to the first chunk of whatever is returned by %QSYSFUNC invocation of the DREAD function delimited by the . (or period).