That being said , in my opinion a region with more athletes as a whole is doing a better job at bringing kids up so they are "better". So this logic is flawed in my opinion.
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As far as regional comparison is concerned, you have first to take into account base population. The regions (unlike congressional districts) are very unevenly populated. I suspect that number of available potential athletes explains more the variance between Region 1 and Region 2 than comparative quality of the gyms. Population probably explains number of athletes more strongly than quality of gym training in a particular region. In statistical terms, what you would want to do is use overall population size in the targeted age group as a control variable.
Even so, there's no way to know for sure without having more information. Many factors can contribute to the size of a given program or the number of optional athletes. Suppose you have Gym A, which is the only competitive gym in Mega City. It has 50 L5 gymnasts and 15 L10s because there really aren't any other options. Gym B is one of six competitive gyms in Huge City. It has 25 L5s and 7 L10s. Which gym is doing a better job? We would need other variables and measures to make the determination.
I'm not a quantitative researcher, but I could imagine building a model that provides a rough way of stacking gyms or regions up against each other. It would be difficult, though, in a federal system where rules and standards vary both from state to state and region to region. Even something that sounds simple like number of state qualifiers per level isn't a simple matter for comparison. States have different standards for qualifying to the championship meet, and we would probably also want to know both ratios of state qualifiers to overall number of participant competitive athletes and base population rates. Even this would only give you a rough approximation. For instance, I'm told that some areas in Maryland have very strong swimming cultures. A lot more kids are competitive swimmers there, and they tend to be more competitive regionally and nationally. Maryland isn't a huge state population-wise, but it may be harder to be the Maryland breast stroke champ than in a larger state where kids are more inclined to play soccer. These kinds of variations and institutional developments that you can only know through cultural/historical analysis are what interest me in my work.
The only place where the quantitative comparisons can be made easily would be at L9 and L10 nationals, where you are looking at head-to-head comparisons of athletes at the same meet. But nationals alone doesn't tell the whole story either about regions or about gyms.