Here is a way how to determinate your paid niche: Make several blogs(5-10). It`s easiest to make them in Blogger. You can get free names for your blogs like yourname.blogspot.com, But it is much profitable to buy domain names for each blog. Post in each blogs about 5-7 articles, put adsense and start promoting your blogs. You can post your links in Social Bookmarks Sites, register your blogs in blogs directories and add links to your signature in forums. Here is a list with biggest social bookmarks. View here how to boost your traffic with StumbleUPon. When you get on each your blog about 20 clicks, choose one or two of them , and concentrate your work on these blogs. If you buy a domains for other blogs , continue to promote and optimize them, and when you get PR for this domains, sell them. You always will get much more money, than you buy them.
Surely there must be a better way of determine high paid niche. There is loads of data out there. what you really need is something like this data on a whole load of categories: 1. How many people are searching (wordtracker) 2. How much adsense is paying out on the the terms (google adwords) 3. How bad the compertition is (yahoo backlinks) If you pick enoguht categories for these you could then calualate niches which are high paying, with little compertition and good traffic. This is how I would work it. I like your way but it's basically version testing. built 100 sites, pick the best 20 and concentrate your effort kind of thing.