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.)
But you're right, it is the fossil record that provides the strongest evidence.