I don't see any compelling reason why the whole HP world shouldn't be magical, with no muggles at all. It'd make the series less escapist, I guess, and might hurt sales, but that'd be a small price to pay, IMO.
I don't think I'd have liked the series as much if everyone was able to do magic. I started reading the series when I was about 10 or 11, and the idea that there could be a whole hidden world out there was something that I really enjoyed. There was a chance they you could be special and taken away to a secret world just by going on a train journey was great.
Take way that hidden world part and you take way a sense of wonder and the chance it could really happen to your self. As kid I really enjoyed that part of the books, something that I wouldn't want to give up. It would be too much of a price to pay IMO.