There is no step between "choose a card from the discards" and "put the card into play": the various play-from-discard abilities are a single-step action. The rules text says uses the phrase "resolution order," so you should fully resolve each player's play-from-discard ability before moving onto the next player with a play-from-discard ability. Alice chooses a discarded card and puts it into play before Bob even looks at the discards.

In general, 7 Wonders doesn't break things into discrete steps, so there's no sense in inventing extra steps for this particular case. I agree that there is a very small advantage for Bob here (slightly bigger if Alice is a neighbor), but that's roughly balanced by Alice getting first pick of the discards.

There is no step between "choose a card from the discards" and "put the card into play": the various play-from-discard abilities are a single-step action. The rules text uses the phrase "resolution order," so you should fully resolve each player's play-from-discard ability before moving onto the next player with a play-from-discard ability. Alice chooses a discarded card and puts it into play before Bob even looks at the discards.

In general, 7 Wonders doesn't break things into discrete steps, so there's no sense in inventing extra steps for this particular case. I agree that there is a very small advantage for Bob here (slightly bigger if Alice is a neighbor), but that's roughly balanced by Alice getting first pick of the discards.