There was a recent study about 99% of people have an abnormal shoulder: https://news.ycombinator.com/item?id=47064944 . We are all unique in our own way, but labeling everyone as ill does not seem productive.
An abnormality that doesn't cause functional impairment, like that link, is different from a mental illness that does. I'd agree with you, if something is that prevalent then it ceases to be a "disorder" and is simply just pathologizing being human.
But, the 23% statistic refers to people that meet that diagnostic criteria of clinically significant distress or impairment.
I'll acknowledge that diagnostic creep may be a real issue, but just because a condition is common doesn't mean it's not an illness that causes impairment in daily life. 50% of adults have have high blood pressure, but we don't change our meaning of "healthy" to include those with high blood pressure because if left unchecked it can have serious outcomes.
The high numbers might not suggest the definition is broken, but rather that our modern environment is particularly taxing on human psychology