yeah, as someone once told me, "every good looking girl in japan is in morning musume!"
But that's wrong. Walk around outside and you'll see hundreds of lovely-looking girls. Sure, they're not at that absolute pinnacle of cuteness but I wouldn't say no. In fact I'd be saying "yes, yes yes!"
To me, an australian, japanese 10/10's are rarer than western 10/10s but 7-8/10s are much more common. The distribution curve is different - maybe there's not so many at that absolute peak of beauty but there's far more who are "very nice".
Seriously, you don't expect there to be all that many beautiful girls at a morning musume concert do you? It's just not their scene. But I'll stand with you outside any major railway station you like and point to 30 cute girls a minute : )