There are no limits to the size of a .py file, so you can certainly perform the copy and paste (and edit) operations you have in mind.
Some caveats:
import library.py
is unlikely to do what you want: it imports a module named py from a package named library. Thus it requires the existence of a directory library with an __init__.py and a py.py in it (or .pyc, etc). I suspect you mean import library.
Merging all the needed modules into one large .py file only works for modules for which you have Python sources (.py) -- you need different techniques if all you have for a module is bytecode .pyc or .pyo, and if any of the modules are native-code binary Python extensions (.pyd or .so or .dylib etc etc, depending on your system) that just won't work.
You may have to do some renaming, e.g. when you import two modules that both define name foo you'll have to alter one or both of those names foo. That's because, via imports, you get qualified names (so there's no problem if a.foo and b.foo both exist), but without imports you get bare names so you'll need to disambiguate them "manually".