2) Their prices are far lower than bitcoin so what you pay in fiat terms appear lower.
I don't think this has anything to do with it. In your example, you used an arbitrary number (0.0001) as a transaction fee, but if there is no competition, then no matter how much 1 ALT unit costs, the user can divide it into smaller pieces in case 0.0001 is expensive. In 2014, you'd be paying more than 0.001 BTC as a transaction fee. Ten years later, you'd pay less than 5% of that. 