In case of a three way tie, you first compare the relative records of the three teams to each other. That won't help in our circular scenario of OU beating Texas beating Baylor beating OU. The records against each other are 1-1. No determination can be made.
According to the procedures, you'd then go to the 4th place team. Say it's oSu. Baylor and Texas have already beaten oSu. I suppose we're discussing the scenario where the 3 top teams all only have 1 conference loss, so obviously OU will have beaten them as well. With only 1 conference loss apiece, and in common, no further determinations could be made until point differentials.
However, if there's two conference losses apiece, then there's a possibility (actually likely) that two teams will have beaten a given team in the rankings and one will have lost. That places that losing team in 3rd, and allows head to head to determine the order against the other two. Notice that this procedure preferentially rewards a team for having a "better" win even though those teams must necessarily have a "worse" loss.