Mmmmm.... I think it depends. In the past, Konoha definitely had more raw power, but, it was divided against it's self. With the death of Danzo, Konoha actually has something approaching unity (rather then a sub-faction working to subvert the rest of the village).
In the Shodai's Generation you had:
The Senju
The Uchiha
7 Bijuu
That's a ton of power concentrated in the village, but there was a noted division between Uchiha and Senju. Meaning that Senju and Uchiha were working against one another at that point.
The Nidaime Hokage worked towards assimilation and stability. Unlike the Shodai, we're not told exactly what resources the village had and what was given away. We do see several things develope under the Nidaime hokage though.
First, The Uchiha are made into an internal police force for Konoha.
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It's important to note that The Police force wasn't created by the Nidaime, as suggested by Madara himself, but by one of the ancestors of the Itachi and Sasuke Uchiha.
Given what we know right now, it was most likely setup by Madara Uchiha, possibly as a means of eventually causing a civil war, though the timing and such leads me to believe the creator was actually Izuna or a seperate, as of now unamed, uchiha.
The third Hokage is noted as one of the most gifted shinobi of ever, and he did vigorously pursue peace, possibly leading to the end of the First Great Shinobi War; however, it is under the Third's reign that ROOT flourished and developed. The Second and the Third Great Shinobi World Wars took place during the 3rd's Reign as well.
Finally, Orochimaru went rogue during this time period, and, while his actions did not result in a subversive faction operating secretly within the village, it did lead to the eventual creation of the sound village.
Little is known about Minato's reign other then the fact that the Kyuubi attacked the village. The attack of the village by the Kyuubi caused a general rise in discrimination against the Uchiha. Madara (or whoever Tobi actually is...) is still a strong possibility despite his testimony to the contrary. This leads to the massacre of the Uchiha clan by Itachi and 'Madara', effectively eliminating the possiblity of a Cou de' etat by the Uchiha police force against the rest of the village.
This leads us to state of the village at the begining of the Manga.
With Danzo's recent demise, ROOT is effectively dissolved. As to whether this is a permanent state of affairs is unknown, but this does mean that there's are currently no known subversive elements left in Konoha.
) Konoha's power went down not because strong characters died out of battle. Remember that each strong characters had passed their abilities down to the new generations in konoha.
