I think the "traditional" family of tiling window managers (like ratpoison, awesome, dwm, xmonad, i3, etc) are kind of simplistic in their assumptions that 1. they can at any time force any window into any size and position, and 2. they must always force every window into some size and position.
Interestingly I like tiling window managers due to specifically the opposite perspective, that applications are often selfish in their assumption that they can display themselves wherever they like and I much prefer ignoring their (usually-wrong) assumptions about what's best. I don't mean that argumentatively, just a different preference I guess.
In this respect I even agree with the first two steps of your algorithm - it's just that "in my tiling layout" is the result of both of them!