Is Washington running out of undiscovered talent? Or has WPA -- the city's most respected talent hunter -- lost the desire to ferret it out?

Both questions haunt "Options '84," the third biennial show of underexposed area talent, now on view at WPA (Washington Project for the Arts), 400 Seventh St. NW. There are a few worthies among the largely postgraduate-level artists in this show, including folk-assemblage sculptor and poet Freddy Reynolds, who is 62. But on the whole, the enterprise is such thin gruel that nearly everyone involved loses.

Except the video artists. For what may be the first time in Washington history, the overall level of video work surpasses that which hangs on the walls (would you believe Neoexpressionist paintings of Popeye and color photographs of dead fish?).

Alison Abelson's touching documentary about her grandfather's family-run New York ladies' department store -- including a tour of the corset department still run by her grandmother -- should help earn her a job doing network features; and Ron Paras' slick computer slide animation "Tactical Love" has already been shown on MTV, where it belongs. Margot Kernan, a respected Washington photographer, critic and filmmaker new to video, adds a welcome conceptual dimension in her contemplation of "imprisoned" photo-images of Greece, shown in the context of quotes from Plato on the nature of art.

An overloaded room filled with Freddy Reynolds' junk assemblages constitutes the centerpiece of this show, recalling -- but surely not rivaling -- the obsessive folk art of James Hampton, whose tinfoil-covered altarpiece is on view at the National Museum of American Art. A hard-to-hear videotaped interview with the artist (no chair is provided) may help viewers pick out the more poignant works relating to the needles and pills endured by Reynolds' aged, dying mother, and the shrine-like sculpture he made from her possessions.

Documentary photographs of the immigrant Greek community in Astoria, Queens, by Greek-born Eugenia Marketos Schnee show a sharp eye for mask-like faces and telling incident (though the color seems irrelevant); and a small, wordless book titled "Breaking Point" by Charma Le Edmonds is well done, but gains nothing by being blown up into an ill-lit, room-size sculptural installation.

Disappointment with this show is underlined by the revelatory nature of earlier "Options" shows. "Options '81" (curated by Mary Swift and Gene Davis) introduced 22 artists who -- it is now hard to believe -- had not had any significant exposure at the time, among them Big Al Carter, Chris Gardner, Henry Schoebel, Alan Stone, Suzanne Codi, Charlie Sleichter and Kendall Buster. "Options '83" (curated by artists Joe Shannon and Ed Love) introduced 30 more artists, including Catherine Batza, Pat Craig, Sidney Lawrence, Andrew Kreiger and Yuriko Yamaguchi. All have since, deservedly, moved into the gallery mainstream.

So why didn't this show work? Have the artist-run galleries like WPA and commercial galleries caught up with all the good but unrecognized talent in town? It's possible. But the cumbersome structure of "Options '84" surely also helped sink it: no fewer than eight artist-judges selected this show, for the first time expanded to include video, film, performance, book arts and literature along with painting, sculpture and photography. "Artists on the artists' committee didn't want any more smorgasbord survey shows -- like the recent auction show -- but wanted to show fewer artists in greater depth," explained a WPA staff member.

The result: the same lack of coherent vision, indecision and compromise that characterized the Corcoran's "10+10+10" show a few years back, when that institution -- tired of playing new-talent scout in what it obviously considered a very thin market -- put the task back in the hands of the artists, and let them go out and hang themselves. Is WPA doing likewise?

Films and performances can be judged in real time: Media Night is Jan. 11, and performances by Rogelio Maxwell and Theatre Du Jour will take place, respectively, Jan. 18 and 19 at 8 p.m. Meanwhile, if this show represents our best options for 1984, bring on 1985 -- and hurry.Wall Reliefs at Artists' Space ----

Artists' Space in Georgetown Court (3251 Prospect St. NW) has launched more than its share of good new talent during its one-year existence, and its final show of recent work by Lenore Winters is no exception.

Winters (who was in WPA's "Options '83") has invented her own medium: untraditional wall reliefs made from several small parts that hang together to form abstract compositions. Once made from weighty plaster, they are now made from squarish pieces of wood that have been gessoed, painted, incised and otherwise given color and textural life as large, sprawling spiral and disk forms.

Said to be based on the ancient Minoan Phaestos Disk, they reveal surprising variations in spirit -- from the exuberance of a giant red spiral that pops off of a painted black wall to the restraint of another handsome piece that evokes the light and color of the Southwest desert. Either one would make the perfect Christmas gift for an imaginative real estate developer with a lobby wall to fill. Winters' work will be on view through Dec. 29, when the show -- and the gallery -- will close, and proprietor Annie Gawlak will move on to Middendorf Gallery. CAPTION: Picture, Photograph by Eugenia Schnee from the Washington Project for the Arts "Options '84" show. Copyright (c) Eugenia M. Schnee