I agree with you about the joke, Darowyn. I believe Shakespeare was trying to make the sort of joke where a person of high degree uses a fancy word and a person of low degree takes it wrong. The singers are referred to as "young gentlemen", but they were probably young enough to be called kids today, and they probably were not of the nobility.

I picture a joke such as this:

Portfolio: Ah, young Ermentrude, though art delectable!

Ermentrude: What, varlet, "delectable"? (cuffs him)

Touchstone's joke fails because "untuneable", while a long word, has such simple elements to it that we don't imagine the singers failing to understand it.

Shakespeare couldn't win 'em all.