here is the big problem with this strategy of yours:
1) Find a newer exchange that doesn't have a lot of people.
this means when the exchange doesn't have enough people, it doesn't have enough volume. in cryptopia that you mentioned the minimum order that you can make is as small as 500 satoshi and these two means the orderbook is filled with small orders, sometimes it is so small that it can not even cover the transaction fees. and most of the time the profit is so small it doesn't worth the time and risk to even try this.
and worst part is that many of these small exchanges, for example Yobit are scam. or their wallets are empty, out of work, ...
and I have tried this, you go buy some altcoin there and when you want to withdraw you hit a brick wall. your funds will be blocked in limbo because you can not cancel the withdrawal and support doesn't reply and the price keeps falling on both places so when your withdrawal is finally canceled you sell at the same place at a much lower price and lose big time.
Guess your analysis is right. I tried it out in the past without much success, either the price differences were so marginal, the risks to transfer to an unknown exchange were higher than the potential outcome or when I spotted bigger differences I always ran into the wall of withdrawal issues. Especially with the bigger (and safer) exchanges like Binance.