What happens to all the money from those paid votes?
They keep it, simple as that! That's why they allow paid voting, to scoop money while they can.
And that's why it's so important to not pay for votes. If you believe in a coin and want to see it successful, it's better to spend money/btc on building marketplace infrastructure so people can use the coin to buy and sell goods than paying to get listed on another exchange for everyone to dump the coin for btc.
I concur with your opinion. Paid voting should never be supported. If the coin is worthy enough and there is demand among people, it will naturally find its way to a exchange sooner or later.