New construction windows in historic district
Yes, I think your plan is correct if you mean to shrink the rough openings. I'd be careful to only shrink as far as necessary, though. I'm very familiar with Andersen 400 series windows, and I think you could incorporate the outer vinyl-wrapped jamb rib into the width of your current casing. This means that you may only need to shrink your rough openings 3/4" or so. 

At my previous home, circa 1956, I did work like this using 400s. I laid 3/4" thick vinyl stock over the mounting flanges and caulked it to the vinyl exterior jamb rib so that they appeared to be a continuous unit, with the rib protruding about 1/4". Actually, I caulked it to the window, the wall, and the J-channel and used no other fasteners. It looked nice and worked well for the decade I was there.