Percy Scott's anti-battleship argument before naval aviation matured

Was Percy Scott right that battleship money should have been spent elsewhere?

Not for the period in question. Aircraft were developing rapidly but were not yet reliable enough to replace battleships as the main naval fighting arm.

The question becomes one of timing rather than whether naval aviation would eventually matter. Percy Scott and other reformers recognized that aircraft were developing into a major naval weapon. In an early 1920s war, however, battleships remained the effective main fighting system while aircraft were more dependable for reconnaissance and gunfire spotting. Even in the late 1930s the balance was not simple enough to justify abandoning capital ships before aviation could replace their combat role reliably.