If you want your marketing signaling to be "this artist is for rich people, normal people have no chance to see them anyways", sure. Many probably don't want to do that - indeed the strength of the lottery system is that it does signal the opposite.
Of course if the biggest venue isn't big enough to do that, then that's more of a problem of the local facilities, or the artist's decision to play in an area with inadequately sized venues.
A Ferrari dealership has to turn away the vast majority of folks who want to test drive their cars, a B&B, or boutique hotel has to turn away customers, or price rooms very highly, on a busy weekend, etc.
They are still very popular regardless.