I once read something that confirms your statement--sort of.
IIRC, it wasn't the oxygen content that made the difference, although it might have.
The problem is that their primitive--by mammalian standards-- respiratory systems (and possibly the other bodily systems as well--especially the circulatory system) become more and more inefficient as the insect's size increases.
Which is why you had dragonflies with a two-foot wingspan during the age of the dinosaurs--the Cretaceous period, I think, although I'm not sure.
(As I said, I'm not disagreeing with you; I just don't recall reading anything that implied that the air was that much different from what we're breathing today--aside from modern-day pollution, and the fact that the climate was vastly different--swampland in places that couldn't support that climate nowadays, for instance.)
Other insect-like creatures, such as the arachnids and their distant relatives (spiders, scorpions, centipedes and the like) may have the same problem--I'm not certain of the differences in their bodily systems.
As someone put it in a book I read many years ago (I'm not certain how long--I think I read it in high school, and I graduated in 1982):
The giant insects and arachnids of nightmares--and horror films--are PHYSIOLOGICAL IMPOSSIBILITIES.
Shadowrun gets around that little bit of science by throwing magic into the mix.

--Foreigner