As for confronting students, different schools have different expectations. As others here have pointed out, this school may expect professors to try to work out cheating issues locally first. I can't say.
Regarding your second point, if any one thing becomes a trend in a class, you bring it up with the class.
I doubt any school has a policy which does not allow every incident of cheating to be reported and handled through established due process procedures. Administration may prefer molly-coddling of the ATM's, but the written policy will almost certainly not require only reporting the third offense.
As for your second point, preaching to the choir is a waste of time and just makes them uncomfortable (as this case points out), the come to Jesus talk is a one on one affair.
In the example from the article, 80% of the class was presumably not cheating - so even if only half the class shows up for lectures the scolding will not be applicable to the majority of the students. Of course, if there is any correlation between lecture attendance and academic integrity (which one might suspect to be the case) then the majority becomes greater. In other words, the ill consequences cited in the article may well be a part of the author's choice of scolding the innocent along with the guilty. Seriously, at the point students are sitting in a university classroom - they all know what blatant cheating is and have either decided to do their own work or cut and paste. Going over basic citation requirements in class is more appropriate for junior-high school English.
Regarding your second point, if any one thing becomes a trend in a class, you bring it up with the class.