It's about Everything.
The plot is set in this specific world, but it could be set anywhere, because it's true. The Young Turks of one generation, bound together by a passion for -- well, anything, really -- and years of hard work and shared experience, always become the Old Guard in the eyes of the next generation, and arbiters of Whatever It Is (the sport, art, religion, political group, school, musical group, etc.). And inevitably, young Iconoclasts will begin to question their authority and knowledge of today's world, and will come to believe that the Old Guard have become rigid and arbitrary, and must be overthrown for the sake of Whatever It Is.
A struggle will develop not only between Old Guard and Iconoclasts, but between members of each group who question their leadership. And the Old Guard will sincerely feel that the Iconoclasts are trying to destroy everything they've built. Factions will develop, and some will be willing to dispense with ethics in the name of Whatever It Is. These ethically shadowy forces will be found out, eventually, thus vindicating the young Iconoclasts.
That's not just the plot of this movie; it's the plot of almost everything -- including real life.
Strictly Ballroom is about a promising young Australian ballroom dancer, who yearns to create new choreography, much to the horror of previous generations of ballroom dancers who control the local contests. It manages to be very funny, and oddly suspenseful even though you know perfectly well what's going to happen. He finds a girl as free-spirited as he is -- who happens to be the daughter of a family of Spanish Gypsies -- and discovers that his dull parents have been concealing some startling secrets.
This fairly simple plot is brilliantly dressed by Baz Luhrmann with sly, continuous humor and costumes that are the definition of fabulous, with sequins, feathers, and vividly colored tulle everywhere you look. And there is some really fine dancing, both traditional ballroom styles and the blazing flamenco of the Gypsy family.
But though this film looks like a highly-colored parody, it actually has hidden depths. It's about civilization and stuff -- humans in groups, from the builders of Stonehenge to the White House staff.