I would say a good niche is one in which you can profit from. Some can be a little odd, while others are small. But if you can generate sales and your business is making profits, it is considered a good niche for your bank account.
Saturated Niche
A saturated niche like make money online is not necessarily bad. It is more important to find good products that sell phenomenally and isn't likely to stop anytime. Yes even in a very saturated niche. Although finding good products may be a challenge for you, do not forget that the prospective buyer never sees the product until he buys it, so quality isn't really the entire picture.
What's A Good Website?
I am assuming that you do promote your products aggressively and consistently using your website. I have decided to list some types of websites which I think may possibly hurt your business advertising efforts e.g. Google Adwords:
Websites without Privacy Policy; Websites containing pop-up windows; Websites which look confusing; Websites which force user to provide email address before being allowed to move to next page.
On the other hand, a good quality, profitable website should at least contain:
Contact us page, which allows the user to contact the website creator or support; Money Back Guarantee, as it is a known fact that such websites sell better.
Are you therefore satisfied with how your website looks? Remember sometimes a simple webpage which is captivating may just be the answer to some of your traffic problems you currently have. If you visit traffic exchanges (you ought to), also bear in mind that the visitors you get from these exchanges are always in a hurry. You will only have a few seconds to capture a visitor's attention and pull them into your offer.
So, before you pass judgment on the make money online niche as overly saturated and impossible to break into this market, it may be wise to firstly make an objective assessment of the situation. Do take stock of any business opportunities you may otherwise have lost, while making a wrong decision. After all, this niche may well turn out to be the gold mine for your make money online business.