The statement [MATH]r(r + \Delta r) \sin \Delta\theta = 2\Delta POQ[/MATH] uses the formula for area of a triangle, [MATH]Area = \frac{1}{2}a b \sin(C)[/MATH]. Are you familiar with this formula?
Nothing is assumed to be perpendicular, until they introduce OY as an altitude of the triangle to express the area a different way.