I have not seen the book, but I feel that they are two different things and need not be configured together. For auth-proxy to work, all you need is "aaa authorization auth-proxy......." and corresponding configuration on the AAA server for the users. If you want to control access to the router itself, then use "aaa authorization exec......" as you suggest.
In conclusion, though they are not related and configured together, I agree with you that it is a good practice to have control on who can have exec access to the router.