Galadriel is more beautiful. Maybe Arwen's face is prettier, but she's nothing like her grandmother. Because it isn't just the features that (for me) tell how beautiful someone is, it's how she bears herself and how is her presence and what "shines through". Taking these things into account, Galadriel sure is more beutiful. Her powerful spirit, charisma and person just clearly override Arwen the Just-A-Prettygirl. Arwen is too passive to be a real striking beauty, if you ask me.
As to Keira Knightley... She is over-rated. I can't deny she's pretty, but she's no goddess (and I agree she's way too thin). I wouldn't have liked to see her as Arwen, because she really is a quite poor actor. Besides, I don't want anyone who says she will go to have plastic surgery at the age of 25 ("because then you start to get wrinkles")
to have anything to do with ME! (No, I don't hate KK, sorry if I sound like that...
)