you can do all that.... or...you can be lazy like me and just copy the layer with the title on it...rotate it and make it small enough to fit on the spine. (IMG:http://www.hirescovers.net/forum/style_emoticons/default/8824.gif
If you have put it on a separate layer with the right font you wont have all the stuff to cut out.
If you are getting a title from an image I use the path tool ..zoom right in and cut a path around it, select the path, feather it a little when cutting out and past it on a different layer...voila!!