In some sense this is true—I like to believe the benefits of exercise outweigh the increased exposure to air pollution. However, we shouldn’t lose sight of the fact that bicyclists are often breathing deeply next to traffic that can, in some cases, be putting out a lot of bad stuff.
I knew some researchers who were specifically looking at the question of bicyclist exposure to air pollution by pedaling around town with nephalometers (IIRC). I don’t remember what their conclusions were, if any. I should look that up.