Sounds like you've got the right idea. Eliminate the selvedge stitches and knit in the round up to the armholes. At this point you can divide front and back and knit them straight--on circs if you want--one for the front and one for the back. At this point you'd have to work back and forth.
Or if you're feeling daring, you can do steeks--you add extra stitches for the armholes and then sew and cut them when they're the right height. But since you say you're a novice knitter you might want to save steeks for later.
If you want to do them, here
is a thread where I showed a sweater using steeks.