After a five-year struggle to make the Washington Art Fair better, ART '81 -- the sixth edition that opened yesterday at the D.C. Armory -- has taken a nose dive.

Last year, a dozen of the best galleries from New York, Washington, Paris and London dropped out or defected to an upstart fair in Chicago, which proved to be so successful that ART '81 had to be postponed from its usual time slot in May. What's left, unfortunately, are too many schlocky so-called "limited edition" prints -- just what the fair has been trying to avoid all these years. The armory is a vast space, and to fill it, entrepreneur Elias Felluss obviously had to drop his entry standards by several notches.

Despite the visual garbage, however, art lovers will no doubt find among the 130 booths enough good prints, drawings, sculpture, paintings and tapestries from the U.S., Canada, Latin America and Europe to make a visit worthwhile.

Art fairs are commonplace in Europe, but the Washington Art Fair was the first in America, and was organized to give dealers and print publishers a chance to supply galleries and each other with stock -- as clothing manufacturers do for retail merchants coming to see the new fall line. Art lovers are encouraged to browse and buy (prices are retail to them, wholesale to dealers).

The good things to be found include a booth entitled Artforum, which represents the stock of a private dealer from Toronto and includes an etching by Marie Laurencin, a fine little oil on paper by the German expressionist painter Christian Rohlfs and several small and deliciously painted landscapes by lesser-known artists connected with the famous Canadian "Group of Seven." A booth curiously entitled Club of American Collectors of Fine Arts Inc. is, in fact, filled with original 19th- and 20th- century European posters, many of them duplicates from the collections of Bibliotheque Nationale in Paris. A nearby booth, Posters Paris, will be of interest to poster aficionados. The most original contemporary art in the show is by conceptualist J. Crimmins, who teaches at Moore College of Art in Philadelphia and has invented a whole imaginary country called La Republique de Reves (Republic of Dreams), for which he has designed not only money and postage stamps but tourist posters and passports as well. His work is in Rodger LaPelle's booth.

Moving swiftly past some of the worst Miro prints and watercolors ever to be seen outside that artist's trashbin, past paintings that look like they were made on one of those boardwalk paint-spinning machines, past some contemporary Rodin knockoffs, the dogged art viewer will ultimately find worthwhile items.

Among them are Eskimo soapstone carvings and drawings from northern Quebec in the "Arctic Showcase" and prints of Joseph Craig English in the Kraskin booth. In the Manasek booth are prints and drawings from the 13th through 20th centuries, including old and new Japanese woodblock prints, some 17th century Dutch book illustrations that include maps and renderings of scientific instruments, and prints by Hogarth (late editions) and Daumier (from Charivari).

Notable among the Washington dealers who did not desert the fair this year are Georgetown Graphics and Baumgartner Galleries. Notably absent is Harry Lunn, the first Washington dealer to lend his backing when the fair began. His name and professional heft had been of major importance in luring other top-echelon dealers to the fair from all over the world. Lunn could not be reached for comment, but an aide was blunt: "We're short-staffed and are just too busy getting ready for a huge opening next Friday. Besides, for us the fair has been a waste of time and energy." "If Washington dealers want a nice art fair, they should support it," insists dealer Manfred Baumgartner. "I think Washington dealers are snobs." "I go to Chicago," said Jane Haslem, who with Diane Brown discovered fertile new territory for sales in the windy city last May and can't wait for the next one.

Don't worry," says the indefatigable Felluss, "they'll all be back."

The real winners of ART '81 have turned out to be local artists, to whom Felluss generously turned over free space for no less than five special exhibitions focusing on Washington art. One, organized by the D.C. Commission on the Arts and Humanities, is the crowning achievement of the entire fair. Entitled "Hand in Hand," it presents the works of area artists who have received grants from the commission this year.

Another fine effort made possible by Felluss' contribution of space and money is "Southern Exposure," a selection of works by 25 artists representing women's arts centers in Atlanta, Chapel Hill, Richmond, Miami and Washington. Joan Mister, a driving force for the Washington Women's Arts Center, made the selections. Mining Washington's ethnic riches is a show organized by Rod Donahue, staff assistant on the arts to D.C. Del. Walter Fauntroy, host member of the sponsoring Congressional Arts Caucus. Ed Love, Percy Martin, Uzikee and George Smith (both of the University of the District of Columbia), David Driskell (University of Maryland) and Al Smith Howard University) are the standouts.

The most rewarding innovation in this fair was an arrangement that made three running feet of space available to any area artist or art groups for $30.

ART '81 continues at the D.C. Armory through Monday. Hours are noon to 9 p.m. today through Sunday and noon to 6 p.m. Monday. Admission is $4 for a single-day ticket.