How to make clean installation of iMac (macOS Sierra)?
Step 3 is "wrong" in this case, if you reboot holding cmd+R you will reboot into the recovery partition.

What you should do is to reboot with the USB plugged in while holding the alt/option key to get to the EFI boot manager.

Then you select the USB media and press enter to boot from it.
You will be presented with the installation wizard, at this point go to the top menu and select disk utility to erase the internal drive (choose GUID partition and HFS+ Journaled as file system).

Now you can close disk utility and proceed with the installation.