A good place to start might be Terry Carroll's Copyright FAQ . He's an intellectual-property lawyer. One point he emphasizes is that, in his reading of the law, whether money changes hands does NOT usually matter (contrary to popular opinion).

Unfortunately, the last time I looked he didn't address the interesting question of attempts to copyright folk material. If there's any justice, those attempts shouldn't work. That is, if you performed a folk song copyrighted by the Lomaxes and then their heirs sued you, I HOPE you could win by proving that the song existed in the public domain before the year they copyrighted it. But I don't know whether the law works that way.

Incidentally, attributions are sometimes wrong. So sometimes songs listed somewhere as "Trad." are actually copyrighted by somebody.