Yeah, that is true. In theory the smaller states matter, but I doubt candidates worry too much about losing the smaller states. I don't think any voting system is perfect.
In Canada, we have the parliamentary system. It's closer to a popular vote system than the electoral college, but it still has issues. One thing I like about the US system is that you can vote for different parties for your senator, congressman, and president. You can't in a parliamentary system. The way it works is you vote for your member of Parliament for your district. The party with the highest number of elected MP's wins the election and becomes the government.
Unless you had a true popular vote system, you are always going to have some issues.