When I go to page 2, I see the same posts as on page 1!
You're using query_posts() wrong. See The Right Way To use query_posts()
I've read in a multitude of places that query_posts should be used as a last resort. It generally is a shorter way of constructing a new Loop (new WP_Query).
So, why does the FAQ insist that query_posts should be used?
Also, does anyone know why my styles are being queued when I use wp_pagenavi in the admin section?