Every $g \in L^1$ yields a linear functional $\lambda_g \in (L^\infty)^\ast$ defined by $\lambda_g(f) = \int fg\,dm$ on $L^\infty$.
The estimate $\lvert \lambda_g(f)\rvert \leq
\lVert f \rVert_\infty \lVert g\rVert_1$ shows that $\lVert \lambda_g\rVert \leq \lVert g\rVert_1$, so $\lambda_g$ is continuous. Taking
$$
f(x) =
\begin{cases} 0 & \text{if } g(x) = 0 \cr
\frac{\overline{g(x)}}{\lvert g(x)\rvert} & \text{if } g(x) \neq 0
\end{cases}
$$
we get $\lambda_g(f) = \lVert g\rVert_1$, so $\lVert \lambda_g\lVert \geq \lVert g \rVert_1$. Thus, the linear map $L^1 \to (L^\infty)^\ast, g \mapsto \lambda_g$ is isometric and hence injective. We can therefore view $L^1 \subseteq (L^\infty)^\ast$ as a subspace.
The point of Rudin's exercise is to establish that $L^1 \subsetneqq (L^\infty)^\ast$, in words $L^1$ is a proper subspace of $(L^\infty)^\ast$.
Indeed, let $0 \neq \lambda \in (L^\infty)^\ast$ be a linear functional such that $\lambda(f) = 0$ for all $f \in C(I)$ which you say you have proved to exist.
Then $\lambda$ can't be of the form $\lambda = \lambda_g$ for any $g \in L^1$ since for $g \in L^1$ the vanishing $\int gf\,dm = 0$ for all $f \in C(I)$ implies that $g = 0$ and hence $\lambda_g = 0$. But we have $\lambda \neq 0$ and thus $\lambda \in (L^\infty)^\ast \setminus L^1$.