And of course, if the value of bitcoins would drop while you were holding altcoins, you would instead receive a greater amount of bitcoins when selling your altcoins for bitcoins.
Ah yes that is a good point.
But what i have found is that when Bitcoin goes down, it drags down all the Alt-Coins with it.
The reason for this i think is because we have to buy BTC in order to buy ALTs.
Question... is why ? so i guess my real question is, is there a way to buy/sell Alt-Coins directly from Fiat ?
Certain alts yes. But not a lot of them. It's mostly well known alts, which at that point you'll see smaller gains than a low market cap coins that you can only buy with BTC/ETH/LTC/DOGE.
If you're Chinese or Korean there are much more fiat to crypto options.