That camera looks to be a 2012 camera that has a 12MP sensor which should* be fine for most* printing purposes.
*What's really important is how big of a book you want to make. Your camera will easily produce high quality images to 8"x10" uncropped. However if you start to crop in to the image (i.e. chop bits out) this will make the image file smaller, and reduce the print quality. Pay attention to how you frame your subject so you don't have to crop at a later date.
With it being an older camera, and with a smaller sensor, the performance in low light will be less than stellar. Is low light photography important to you? Presumably if you're making dioramas you can put them somewhere well lit (like a big window in bright light) to reduce issues there. If you're going for "moody lighting" though, the camera may struggle.
I would suggest a tripod or some sort of support to hold the camera steady unless you're sure you have steady hands (a cushion can work in a pinch). Many "blurry" shots are caused by shutter speed being too slow and 'wobbling hands when zoomed in too much' causing issues.
Finally, I would suggest ordering a couple of 6x4 or 8x10 prints of your images to see how they look in print. 8x10 as a print will look very similar to 8x10 in a book and it will be a cheaper way of making sure everything is ok. Having prints is also a good way to curate the images you're going to use in the final book too.
In terms of specific technical details, it's very difficult to help without knowing the setup, what you're taking a photo of, what lighting you have available (windows), and what your problems are with the images. I'd suggest taking some pictures to begin with, then seeing what (if any) issues you have with them and dealing with them one at a time.