It's probably easier to define if you put the word 'traditional' in front, or 'contemporary', 'country' etc. You can then have 'popular' folksongs of the 60s - P,P&M for example, or 'traditional' tunes for a dulcimer, or a 'modern' blues that was composed last week.
That way they can come under the umbrella of 'Folk' while staying in separate/definable pockets.
I prefer 'trad' stuff these days but can still enjoy 'popular' songs occasionally.
But I don't believe Beatles or Judy Garland songs will ever become 'Folk'.
Robyn