why would "good" but "not brilliant" students like to study in a conservatoire? With what goal?
Well, firstly, why shouldn't they? If they're not good enough they won't get in. If they are good enough why should they be denied the opportunity to get better? Perhaps they might be brilliant given a different teacher or a new approach to their instrument. Arnold Steinhardt made his debut with the Los Angeles Phil at age fourteen, but when he got to Curtis at seventeen, Galamian was so horrified by his playing, in particular his bowing, that he sent him away to practice bow movements without a violin. Should he have been turned away for not being "brilliant?" Steinhardt was good, but he became magical under Galamian's tutelage.
Not many conservatoire students are going to be soloists. In the strings department, the top students might become soloists or go into quartets. The rest might become orchestral players or go off to play in a folk band (especially if they studied in Glasgow) or a rock band; they might become teachers, or move into musical research; or they might just enjoy the journey and then get a job as an accountant and keep music for pleasure. If you were only going to fill spaces on a course with potential soloists there might be a lot of empty chairs.
One of the things that always amuses me about the grade obsessed world of (classical) music lessons, is that the RA (and I suspect other conservatoires) doesn't require applicants to have passed any of the graded exams. One very good opera singer I know sang grade six level songs for his conservatoire audition. He was probably around grade eightish at the time, so certainly no high-flier, but he is now in the great position of being employed full time and has performances at Glyndbourne and the Proms on his CV. He too was "only" good, but has become brilliant.
But what if he hadn't become a brilliant singer? What if Galamian had never "fixed" Steinhardt's bowing? They would still have followed their dreams, and if those dreams hadn't worked out, then at least they would have no regrets. They stretched and blossomed. Why should someone be denied that?
Why should someone make themselves small (and never stretch for the stars) just so other people can feel bigger (and entitled to the stars)?