Lined is the outer most stiching on the cap face and side and around the button - etc. I do not know what figures you are using but the Dixon figures have raised edge so that one can line the caps.
http://www.geocities.com/pentagon/barra ... frame.html
look at the third figure from the left the Grenadier the face plate is in the centre then the facing color the thin white stiching is the line
Also around all the buttons on the uniform etc
Click 1660-1670 button for example described
http://www.geocities.com/pentagon/barra ... frame.html
Click 1685 button for example described
At good example to follow is on this page too.the first figure I would interpret in words as
following the painted image: coat blue /cap bag blue Lined white/blue facings lined white/cuffs red Lined white /Britches red / Stockings red