it's just not a nice thing to say to someone in front of a Crowd of People. What is a compliment to one person is an insult to another, but a majority of people (regardless of gender) will tell you that unless the person asked Directly how pretty they are on a scale of 1 to 10, any pretty rating is usually not welcome.

Additionally, its the way he said it to people. If they were talking privately and he said that (again, if she asked for his opinion), that might be more justifiable. In the real situation, he was drunk and said that he rejects Very Pretty girls and that his current girlfriend is Not a Very Pretty Girl, so it's okay for them to date. It's pretty rude, especially in front of a bunch of people.