Oh I got it, I got it! So you just include the new body stitches into the armhole section and decrease as needed in the sleeve. So by increasing stitches in one area both get bigger at the same time. So simple! I do tend to make things difficult and overanalyze.
My book describes it exactly opposite-casting on to increase the armhole (and then knitting the sleeve) first, then when going back to work the body, picking up the added armhole stitches into the body round thereby having no underarm hole to sew up later.
Another knitting mystery solved-I should have asked sooner!! Thanks a bunch!