Looks are all relative. If everybody looked like a 10 everybody would be average. Ugly people's purpose is to allow 8+ to look good by comparison. Ugly and beautiful people have always existed and it's not going to change.
Just like if every guy was 6'2". 6'2" would be just average and no longer considered an advantage.
If everyone is a billionaire then nobody is rich, etc.
Also forgot to mention. Beautiful people can produce ugly babies and vice versa. Some features and phenotypes don't mix well.
No it's not all relative. Good looking people are all still good looking. The human brain doesnt adapt to find good looking people average.
To answer OPs question, no nothing will change. As womens requirements for men get more strict, mens requirements for women become less strict. Women carry just as many bad genes as men if not more. They certainly carry the manlet gene.
So expect a bunch of sub 5 women to reproduce with 5+ men and pass on their sub 5 genetics.
No, not with the phenomenon known as regression to the mean. For instance, when two tall people have a child, most of the time the child will be taller than average, but not as tall or taller than both of the parents.
So basically the child will be closer to the average if both parents are closer to the extremes. It works like this with everything inherited, from looks to IQ.