If I understand correctly, a higher EPC means higher earning potential, but a lower payout means a significantly lower testing budget required.
From my initial digging around, it appears a general trend that EPC goes down as offer payout decreases. (Someone let me know if this is inaccurate).
-- Therefore does it also follow that all things being equal, lower payout offers are harder to turn a profit on the same traffic source?
"Therefore does it also follow that all things being equal, lower payout offers are harder to turn a profit on the same traffic source?" This is incorrect.
EPC is irrelevant. Profit happens when your earning per click is lower than your cost per click.
All the payouts and traffic prices are based on supply and demand. Usually higher payout offers tend to convert with more expensive traffic. Lower payout offers convert with cheaper traffic.
The fundamental formula you need to know is
Profit = (Revenue per conversion - cost per conversion) * number of conversions
Your ultimate goal is to maximise your profit, which means that you should try to either increase your revenue per conversion or lower your cost per conversion (or ideally both) while increasing the number of conversions.
All other metrics are either subordinate or intermediary to this objective.