Paleontology has been really helped by the ease of sequencing, to the point where many evolutionary arguments are moot. Humans are apes, birds are dinosaurs. Some people still dispute it, but not with evidence on their side.
Phylogenetics is amazing, given surviving members of a clade we can reconstruct the ancestors. Phylogeny techniques can use additional info, eg paleontological record.
That just shows they diverged from crocodilians after that clade diverged from turtles. It doesn't show birds and dinosaurs are more closely related to each other than birds are to crocodilians (but the fossil evidence shows that.)