Homeless, this is an excellent thread, and I'm glad you started it. The one rule I would impart is that there are no rules. Sometimes songs just seem to drop into your lap, from nowhere at all, and you have to scramble to write them down and/or record them before the inspiration fades. Sometimes it's a very tedious process, trying things, rejecting them, honing, polishing, etc. I write a lot, and I've had things come to me in a variety of ways. One of my favorites literally came to me in a dream, and I found it running around my head as I was waking up. Others have taken months, and/or have started as pages and pages of text that had to be ruthlessly edited before I had something coherent and concise enough to work. If your first song follows one path, and your second follows another, don't worry about it -- you did the right thing both times.
Other advice I would offer is to avoid editing too early; just get the ideas out at first. But to balance this out, make sure you'll be willing to edit later -- as Amos said, it can be painful, but it's necessary. I also agree with Amos's points about implicit images and internal rhymes; these are good tools to have in your kit, or at least good concepts to be aware of. I'm not sure I'd agree with all of the comments that have been made in this thread -- there are lots of good songs that last more than three minutes, for example -- but it's good to consider these things.
Remember, though, that this is a creative process, and sometimes breaking the "rules" can bring interesting results. There are some songs that don't rhyme at all, but fall easily on the ears just the same -- I remember noticing this about a song by John Fogerty (Creedence Clearwater Revival) called "Long As I Can See The Light". Others were started with no clear idea what they were about, but ended up being quite coherent and appealing. Dummy lyrics can be a good tool to help you make progress on the musical end even if the words haven't quite caught up yet (the most famous example of this is probably Paul McCartney's "Scrambled Eggs," which he carried around for a long time before eventually transforming it into the most covered song of all time --"Yesterday").
I'm looking forward to checking back and seeing what other ideas surface in this thread. Good luck.