Definitely oversimplification and I don't mean to understate the efforts, technology, engineering, and materials that went into the ISS. It's incredible. My main point being just how simple the current state-of-the-art is compared to what would be needed for a sustainable orbital shipyard.

We know how to assemble stuff in space, it's just expensive.

Indeed (ISS being a good example of this fact). The scope here though is beyond just assembly. Also, at minimum, manufacturing of shielding components would likely be necessary in order for such an undertaking to be feasible.