Well, you first asked how come those options are not more expensive, and I think the above answers address this. There may be variety of reasons, but the simple demand & supply is the main one. If someone will create demand then they'd become more expensive. While when they're too "cheap", it means there is competition in selling them and someone may not be able to sell them for much more. Just like SPX & UVXY options become super-cheap when VIX drops below 11, or vice-versa - VIX indicates how cheap they are. And they can be cheap when everyone wants to sell them but there aren't enough buyers. Once buyers come in, SPX options and VIX go up, and can go higher than those penny stocks and their options. Even though they're very cheap when nobody wants them.
So assuming that you get an idea why they're "cheap", you can try to do something about it but that's when someone else may not be able to answer "why this or that" because when you're the one trading them then it becomes you territory and everyone else should be asking you questions
Re: "So assuming you know when to go long and when to go short"
Then you can figure out all kinds of plays with any stocks or option. That is independent of why they're cheap, because just like in my UVXY & SPX example, those options can be way too cheap but when you know when to go long then you'd make a killing. And some people do.
Generally I suspect that some edge is possible here, but it would be limited by capacity/liquidity/volume, and options pricing that self-regulates based on demand, especially from people who know when to go long and when to go short.
Though you could also forget about all the if's and why's, and simply calculate and backtest some theories. I'd imagine that if you bough 10-cent options on 100 stocks with potential to double in price, you'd end up making money on 1-2 out of 10, so you'd need to make $0.50-$1 on each winning one (500%-1000%) to break even. When you add commissions and/or slippage then it'd be a losing game.
It can be more difficult to buy puts on those that spiked up and have potential to go back down - as those puts get very overpriced when the stock price spikes up.
However, it's quite possible that some traders do quite well with options on micro-cap stocks.
And I don't think anyone can argue that it's impossible to make money trading those options. You simply asked why they aren't more expensive. While trading them is a different topic and that's where everyone works on their own game plan.
Iam going to read this few times before responding