Sorry, but I think rather than clearing things up, your post causes more confusion. First of all, you're not giving a quick primer on the multi-armed bandit pro

Sorry, but I think rather than clearing things up, your post causes more confusion. First of all, you're not giving a quick primer on the multi-armed bandit problem, but an attempt at describing of one specific algorithm for it. That distinction is important, because there are several algorithms with different trade-offs, hence the linked post. Second, your description isn't very coherent: probabilities have to add up to 1, and the probability to pick a machine in step two can't simultaneously be both 0% and 50%. FWIW, the article already contains a very accessible description of what the problem is about: "Imagine you are in a casino facing multiple slot machines and each is configured with an unknown probability of how likely you can get a reward at one play. The question is: What is the best strategy to achieve highest long-term rewards?"