Display teams have nothing to do with combat readiness. It's like national teams in sports. With their performance and appearence, they represent their country airforce among other airforces worlwide. They have nothing to prove to other pilots, although most of them "hate" them for all the publicity and travelling they get.
Having watched almost all european teams, i think the Reds are the second best, just a bit behind the Frecce Tricolori.
As for the americans, after those 2 stupid accidents last year for the Thunderbirds..., Blue Angels get the 1st place.