moist and shaded is the ticket. They tend to curl up if they dry, however mine always seem to come back. Once established, then they can grow into the dryer regions. I have started mine directly under large branches so they were almost fully shaded and they did fine.
So the necessities:
3. lower light until established.
I have actually found this to be one of the easier to grow selaginella's. Once established, it requires the least amount of attention to keep it going...