1) So as long as you remove your bitcoins from the exchange immediately then you are still in possession of your bitcons, correct?
2) To get USD in return for bitcoins I assume you reverse the process and send your bitcoins to an exchange?
3) Is there another purpose for these exchanges, for instance do some people store their bitcoins there for weeks/months? 


I'm confused what is the benefit of storing your bitcoins at an exchange?  I would just store my private key in my safe at home and a few other hiding places outside of my digital harddrives.