Don Meixner above had it right: it ain't the song, the tradition is the singing. In my community, bluegrass and country music are the styles that are shared and learned, and when we gather at parties, people know the material. Or the shapes and forms of the material if not the songs, meaning that they can join and contribute. At parties where someone just has to pull out some idiosyncratic pop song, you can feel the energy wane from the room, and hear the diminishment of interest in the playing.

But I've been to parties where a room is devoted to swing/jazz, another to beginning folk (well known, easy songs), and another to bluegrass. The complicated culture of how to fit in among those groups is quite real, and attests to the living tradition of people making music together, whatever the style or genre; it's within reach, and comprehensible to the players gathered. It's a common language shared. The navel-gazing individualism of some writing disallows a group to identify and play it, and after a few minutes it's back to Little Maggie or some such.

I see an important division of topic in the subject of who's recording what and how they're producing/marketing it, and what's being sung in actual situations where people bring their instruments and voices and make music non-commercially.

What's being sung and played at the parties? There's your folk music.

What's on the radio, and in the stores? Maybe it'll be sung at parties down the road somewhere, but it's product on a shelf until that happens.