Photoshop :: Order Of Steps In Retouching A Photograph

I am new to the entire graphics arts area.  (I do network design for a living).  I have been reading the "Adobe Photoshop CS5 Classroom in a Book" and I don't understand their logic for the order they say to use to retouch a photograph.
 
Their order is:
 
Duplicating the original image or scanEnsuring that the resolution is appropriate for the way you'll use the imageCropping the image to final size and orientationetc. 

For their example they use a picture of a child walking around a ring with a brick wall as the background.
 
Now, lets say that I wanted the final image to be of the child only and 3 inches wide by 5 inches high, and 72 ppi (pixels per inch) for a print.
 
I disagree with the order of steps 2 and 3.
 
In step 2, I decrease the pixel information to 72 ppi.
In step 3, I crop only to get the child
then I import the resulting picture into say Microsoft Word and stretch the picture to be 3 x 5 it would seem to be that I would be way below the 72 ppi desired result.
 
What am I missing?