Hold on, S, I think you’ve contradicted yourself there. You said a tiny magnet is able to pull an object against gravity, but you also said that magnets in space wouldn’t do that.
I was qualifying 'for your purposes'.
A mere child's toy magnet[1] will hold a steel can up from falling to Earth. If in contact. It will also lift that can up from the Earth it might have been in contact with, but needs to be (practically) touching before it does so. It doesn't do much if it's held away from the can (either time) by a few centimetres. Either with an actual gap or a (non-magnetisable) buffer material. That's because it's a gradient down from the little (but effective) force vs a similar gradient down from a huge (but subtle, by direct comparison) one.
Orbitting 10m above/below each other? You're finely tuning your magnasat to travel in near-matching orbit (inclination, eccentricity and the appropriate set of major/minor/semi-major axes too). The difference in velocity is ~0.5cm/s, or making up/lagging about
1/
50th of a second, per orbit, over an orbit of maybe 1.5-2 hours (depending upon the orbit, but assumed low-ish, for our purposes), so you'd also be orbitally-inserting at an extremely accurate time in order not to be a significant angle of the orbit away for hundreds of thousands of their
slightly different orbital periods, which could mean you'd wait up to 50
years between being actually just 10m away (if I've not misplaced a magnitude or two, somewhere in that rough calculation.
If you've got that much control (or accuracy of launch such that you no longer need to adjust anything once orbital insertion is complete) you might as well unfurl a physical (yes, perhaps magnetic, but could as easily be grabbing) arm while you're effectively stationary next to your target. I doubt you've got a string of 'dead' satellites all doing
exactly the same orbit as each other that you can afford to skim your '10m lower' magnasat past over 50 years to save sending more than one magnasat up.
Also think what happens when magnasat passes magnatarget. As the force becomes significant between the two, on approach, magnasat slows already slightly slower magnatarget (perhaps before the vector even includes significant 'up/down' components). Magnasat is bent towards a higher orbital profile, rushes (slightly!) past no longer 'parallel', radially-speaking then is retarded (as it drags magnatarget faster again) as it starts to slowly move away. It messes up your expensively-obtained fine-tuning somewhat[2], unless you somehow create a resonant co-orbit (taking into account periodic lunar and solar influences, and the complicatedly oblative and heterogenously dense nature of the Earth's mass, including the pull of the tide-pulled oceans themselves lumped up by Sun and Moon periods and land-mass/ocean-floor undulations). Fifty years later, if that's what you're content with (and nothing like solar particles or even other, unrelated, debris has further made your passive and patient rendezvous even more chaotic[3]) it perturbs both (all of..?) the magnacraft yet again and you've perhaps got to wait until the century anniversary before you know how.
Nor could you expect subtly imperfectly-aligned orbits to gently coalesce their group together. Perhaps enough stuff up there going all Kessler-like would eventual form rings (afted generally bashing together, sending far more random bits back to Earth or even entirely ejecting them outwards in the process) but by then you've already failed to clean up the orbits to some quite spectacular degree... Gently sticking together would be the exception, not the rule. The relative scale of things just isn't on your side, sorry.
[1] N.B.: these days you're clearly asked to keep magnets away from small children. Maybe because they've got too much iron in their diets already. /s
[2] As anybody with KSP, or similar, experience knows, thrust applied in orbit doesn't always dump straight into perigee/apogee (or perikerb/apokerb?) adjustment, or straight-forward orbital interception even of a craft in easy visual range.
[3] Assuming that 50 years already isn't enough for the orbit to decay completely or intersect something far less gentle in its relative approach velocity.