The problem is not that there isn't talent and creativity to make something like Bayonetta or DMC, the problem is the business side in the West.
DMC / Bayo are designed entirely around the character, and more importantly, the combat. Basically, it's about what the character can do - or better yet, what the player can do WITH the character. Every decision the developers make during the vast majority of the project is to further the combat. Often times, the stories go in last second (like seriously, last month or two) - they are an afterthought.
In the West, it's about "what can this be compared against" or "how can we position this game to compete against X" or "it's like Skyrim with GUNS!" or "we need huge cinematic story and presentation!" It's not about "here is something you've never played before". You don't get much of that from the West unless it's indie studios doing something just because they don't have anyone to answer to.
In the West, you need a "do something cool" button (like in GOW - beat on a guy, button shows up, hit button, some badass destruction happens... also Darksiders!). In Batman, a prompt comes up that lets you cancel out of almost anything you are doing and "do something cool (counter)". This type of system allows you to be more loose with your inputs and decisions. It's not a bad system by any stretch, but it also doesn't reward practice, skill, execution like DMC/Bayo does. Is that a bad thing? Of course not. It's not even bad design! Not all games have to be the same, or "Japanese", to be good! More forgiving systems that "give" the cool factor to you without you earning it are way more market-friendly (Western friendly) than the alternative.
In DMC/Bayo, the reward is the journey: "I did this... holy shit, I did this!" (can be applied to Dark Souls as well). In many Western games, it's more about the destination: "I played up till this point, now give me something cool... I totally earned it... cause I have X hours played".
In Japanese combat games, the reward is the realization that you actually can do it. It's like trying to bake a cake for someone when you've never baked before. You finally take it out of the oven and go "wow, this is pretty good... I DID THIS!!!" In Western games, it's more like "I waited in traffic for 3 hours, I deserve a cake now".
Which one is more business friendly? You paid 60 bucks and you'll get a cake every 3 hours no matter what? Or... "you'll only get the cake when you earn it... with skill... with execution... with practice"?
There are always exceptions, though.
Everything about AAA development in the West is about maximizing the bottom line. Big budgets, incredible production value, amazing voice-talent, tie-ins, on-disc DLC, pre-order bonuses, etc. In Japan, it's more about "We are going to make a really good game... we will try our best... we owe it to our fans, and to ourselves to do better than we did the last time." In the West, it's about "we can totally make more money this time by doing XYZ".
Now, don't get me wrong. The development talent in the West is incredible... but 99/100 times they have a suit to answer to, who has an even more important suit to answer to, who has a board of directors to answer to, who have stockholders to answer to. This exists in any big-business... but the bottom-line doesn't always seem to be the #1 factor in non-Western development.
This leads back to my very first sentence - it's not about the lack of talent or creativity, it's about the business side.
Think about it this way: a game like Shadow of the Colossus would never pass the greenlight in the West at any major studio. The discussion would go like this: "You want to make a game.. with 24 bosses (originally), and a horse... and... uh you ride around and just fight the bosses... and there's no real dialogue... and the story is somewhat vague... and your main mechanic is 'hold on tight' am I getting this right?"
"LOL... no"
However, if SotC sold 2-3 million copies, a similar meeting in the West may go the other way. Now there is proof that it's not an obviously bad decision. "So it's like SotC... but with a more approachable story, more western-friendly characters, some insane cut-scenes? Let's do it!".
I would wager that there are plenty of developers outside of Japan that could make a combat game as intricate and skill-based and rewarding as DMC or Bayo. The real question is: Who is going to let them?
The answer is: No one.
Gotta do it yourself (no better time than the present).
