Cheryl, The pups are ready to remove when they are 1/3 the size of the adult. After removing the pup don't throw the mother out as she will more than likely re pup(s).
I would make the cut here at the white line.
Also the piece that you remove below the white line can also be planted to throw pup(s).
Do not be stingy on the twine when securing the plants. I learned the hard way and the winds blew them out at first.
Here is a updated photo from this weekend...
Still do not know what I am doing wrong with my Plumeria. Every one I see around the area are in flower except for mine and I just got new opened leaves in the last week.