[guided]We are about to use only the formal property "preimage of closed under continuous is closed". Both projections $\pi_1, \pi_2$ have been verified to be morphisms in Step 2, hence continuous in the Zariski topology — this is a basic fact about morphisms of varieties: pullback of a homogeneous polynomial along a morphism is a polynomial, so the preimage of $V(F) = \{F = 0\}$ is $\{F \circ \pi = 0\} = V(F \circ \pi)$, again a closed set.
We can also describe the closed sets $\pi_1^{-1}(V)$ and $\pi_2^{-1}(W)$ very concretely in $\mathbb{P}^N_k$. Choose homogeneous polynomials $f_1, \ldots, f_a \in k[X_0, \ldots, X_n]$ generating $I(V) \subset k[X_0, \ldots, X_n]$. On each chart $\{Z_{0j} \neq 0\} \cap S_{n,m}$, the projection $\pi_1$ sends $[Z]$ to $[Z_{0j} : \cdots : Z_{nj}]$, so the preimage of $V(f_\alpha)$ is the locus where $f_\alpha(Z_{0j}, \ldots, Z_{nj}) = 0$. The polynomial $\tilde{f}_\alpha^j(Z) := f_\alpha(Z_{0j}, Z_{1j}, \ldots, Z_{nj})$ is a homogeneous polynomial of degree $\deg f_\alpha$ in the $Z_{ij}$. Hence on this chart,
\begin{align*}
\pi_1^{-1}(V) \cap \{Z_{0j} \neq 0\} \cap S_{n,m} = V(\tilde{f}_1^j, \ldots, \tilde{f}_a^j) \cap \{Z_{0j} \neq 0\} \cap S_{n,m},
\end{align*}
a closed set in this open chart. Glueing across the cover (and using the analogous formulas for the other charts) shows $\pi_1^{-1}(V)$ is closed in $S_{n,m}$. The geometric content is clean: an $S_{n,m}$-point $[Z]$ has $\pi_1([Z]) \in V$ iff one (equivalently, every nonzero) column of the matrix $[Z_{ij}]$ lies in $V$ as a point of $\mathbb{P}^n_k$ — and "every nonzero column lies in $V$" is a Zariski-closed condition because being in $V$ is closed.[/guided]