nice theory frog but you left out one thing..... evolution! if a group of dinosaurs ( most likely small dinosaurs ) survived the k-t event and lived to the modern day then over the many generations they would have adapted to the changing levels of O2 in the atmosphere. just like any animal would.
This argument is self-refuting. If dinosaurs survived and evolved to fit the changing environment, there is very little chance they would still be recognizable as dinosaurs. Look at birds - they bear little resemblance to their archosaurian ancestors.