Generally speaking, your explanation is correct. This is normally the way these phrases are used. However, as Cathy said, there is no distinction... there is no rule about it. If I said "when I was little..." I would be talking about my early childhood, the idea being that when we are children, we are not fully grown (big). However, if I said, "when I was young", I could be talking about the time of my youth (although, I would more likely say, "when I was a teenager"), my twenties or even my thirties, since I am in my sixties now. So, that phrase can be relative to the age of the speaker.

There is not really a distinction. Anyone can use either phrase to talk about their childhood, no matter how old they currently are. :)

i think you can use both but in my opinión "When i was young/younger" sounds more natural. Cheers!

설명이 도움이 많이 됐어요. 덕분에 머릿속이 말끔히 정리됐네요. 고맙습니다 ^ㅡ^

There's no real difference between them. I would say that young can mean childhood through youth and into young adulthood. Little specifically means a child "a little kid." 한국어로 좀 하면 young은 일반적인 말 이고 little는 특수한 말 이에요. 그런 느낌 있지만 사실 다르기 없어요.