"Not too long ago we could go to a folk club and know we would hear a song that fell within a limited range of styles of composition based on folk forms"

That makes me think you were either remarkably lucky in the types of clubs you visited or were, perhaps unconsciously, selective. In my own area I could expect to hear a very wide range of styles. However in those days there were plenty of clubs to choose from, and I could go to those which were to my taste and ignore the others. Nowadays with far fewer clubs about it is perhaps more difficult to find a club to one's taste.That doesn't mean the others were being dishonest in describing themselves as folk clubs. You got to know which ones to visit, or avoid, by their reputations.

Honesty doesn't always work. One club in my area started up with the intention of breaking down barriers, so it called itself a 'music club'. On the opening night among the usual suspects from the local folk clubs there were a couple of unfamiliar, and better-dressed, women. As the first performer stood up with his acoustic guitar one of them said, "Oh my God, it's a FOLK club!" and they both left.