Hand size, finger length and forearm length are not the same proportion of body size for different people. Some people have longer or shorter torsos.

Saddle dimensions are not necessarily all the same. The tip maybe closer or further from where you sit.

Reach depends on where the hands rest on the bars, not where the bars meet the stem.

Reach varies according to how aggressive you want the riding position to be.

So I don't see how that method could possibly work, other than by accident, for setting reach. It might be helpful for checking whether the bike size is in the general ballpark.