What is the purpose of ethanol in a DNA extraction experiment?
In the case you describe the ethanol is not there to do anything with the cells but to make the DNA precipitate out of solution. DNA is very poorly soluble in 50-70% ethanol and it will precipitate out as a white sticky pellet. It works even better if the alcohol is kept very cold.

Ethanol does kill cells by denaturing proteins and disturbing the lipid bilayers but after you have added the soap, most cells will already have been disrupted.