Let me give a little bit of insight.
1. KL people who venture to JB high end condos are mostly well to do. Otherwise they might as well stick to KL properties which is a lot safer. Yes, they couldn't be bothered if the market crashes or not. I know many who does not need bank loans.
2. Those Malaysians who buy mid end condos are mostly Johoreans / SPRs as a starter home, not for rentals.
3. Yes, Penang would perform better than JB overall as its land is limited on the island. JB can only compete with Penang in locations that have limited land and waterfront. However, in terms of prospect and development, Iskandar fare better as Iskandar is a greenfield with multi sectors planned eg financials, education, manufacturing, hospitals, etc. Penang is running out of options in these sectors. It remained to be a tourism / retirement island concept. There's no more manufacturing and financials. Besides it is too far from anyone except for itself. Incidentally, Kota Kinabaru properties are one of the highest in the country.
4. I am not worried about Iskandar long term. Unfortunately my personal quota for Malaysian investments is full, otherwise I would plonk further.
It is just that I am diversifying to other countries for a balanced spread. Think very hard and ask your self why Iskandar suddenly so aggressive in development. Everything happen for a reason. Then just ride along the wave to catch the wind. Of course, you must have the bullets, if not what's there to talk?