It is fair to say that there is no realistic possibility of a single party winning a majority in the Scottish Parliament. Up to now a Labour-Liberal Democrat majority coalition has ruled in Edinburgh. It is uncertain what would happen if that coalition lost its majority.
The First Minister of Scotland is elected by the Scottish Parliament. I am not sure if he needs an absolute majority or if a majority of those members voting is sufficient. There does not seem to be any reason why there should not be a minority coalition, once a First Minister has been elected.
The current Parliament elected in 2003 (and the first Parliament elected in 1999) comprise:-
Labour 50 (56), Scottish National Party 26* (35), Conservative 17 (18), Liberal Democrats 17 (17*), Scottish Green Party 7 (1), Scottish Socialist Party 6 (1) of which 2 have since formed a party called Solidarity, Scottish Senior Citizens Unity Party 1 (0), Independent 5 (1). The party total marked * includes the Presiding Officer, who ceases to be regarded as a party member whilst serving as Presiding Officer.
It will be seen that the three largest parties all lost a seat or seats in the second election, as the voters realised that parties with no hope in first past the post elections could win seats in a proportional representation election.
I agree that is the obvious interpretation. I think if an absolute majority of all members was required it would have been specified in the legislation.