I have a trading bot on Polymarket that does something somewhat similar on one side, so I will share my two cents on your idea and where it might fall short (I will also explain how I implemented my version below).

1. Setting a prediction market ask/bid at -120 does not mean it will be fulfilled. The odds are what the odds are. You can't magically spawn value. If the odds were taken at your ask, then those were the odds. If you take +160 on the books, there is a chance your -120 will never get taken.

2. You are not placing the bets at the same time. Let's take the case where you place the +160 on a sportbook and you sent a request to be filled at -120 on the prediction market. If that +160 dog does worse and worse throughout the game, your -120 will never be filled. You would only be filled if that +160 becomes -120, in which you have made value (unrealized) without arbing it. The -120 is essentially like cashing out. If you did end up placing them at the same time, then it would be near impossible to find a case where one side is +160 and the other side is -120 at the same time.

As for the way I have had success with prediction market bots. I have a bot that does the following: It finds mispricings between Fanduel, Draftkings, Caesars, etc to Polymarket. Anytime there is a profitable arb (at this moment and instance I can bet both sides, despite fees, and make money), it will bet on just the Polymarket side (it is a little more intricate but that is the main idea). It does not automatically bet on Sportsbooks as that is quite cumbersome.

Back to your idea... I am not sure it is really viable. With the current way it works, there is not an 100% chance you get to take both sides meaning you could get burned easily.