Yep... That's one of the issues with scalpers that rely so heavily on execution, they are generally not very scalable or 'compoundable' strategies as the account grows in size. That is, a $1 mill account trading say 100 lots is going to be much more impacted than the guy placing 0.01 lots at a time.
But there will also be a collective whipsaw effect, if a broker has 1000 people trading the same system, all at the exact same time, same orders, ALL people are going to get a slice of slippage, regardless of size traded. You trade 10 lots, you get slippage, you trade microlots, you get some slippage as well.
And that's the reason why, I believe, such a scalper will stop working sometime in the future. Obviously, I could be wrong and everybody makes huge piles of $$$, in fact that could very well happen for some time before the strategy becomes too widespread.