"Dan" wrote:

This would seem to pose a safety risk in IMC, would it not?

Yes, it could. Extremely low temperatures can be dangerous to low-flying
aircraft because altimeters will read high in such conditions.

Ideally,
wouldn't altimeter settings take this into account?

Yes. Also ideally, I would be flying a new Bonanza.

I assume that since all altimeters will behave this way, ATC obviously
expects me to be at, say 10,500 as indicated by my altimeter, even
though that could be 10,900 or so MSL _actual_ altitide..

Yes.

Seems a bit sub-optimal somehow... even dangerous.

It works fine as long as everyone is using the local altimeter setting.
Watch out near the ground when it's real cold, though.

--
Dan
C172RG at BFM