Around here (West of Ireland) ceilidhing to the older generation still means house-visiting for the purposes of making music and a ceilidh-house is one where musicians were known to frequent and made welcome.
This is part of a long and useful description from Fintan Vallely's invaluable 'Companion to Irish Traditional Music'.
Jim Carroll
ceili. 1. In Northern counties the term denotes a social visit, e.g. 'going on a kaley', kayleying, making one's kayley. 2. Throughout the country it means 'social dance' with what are taken to be indigenous, old-Irish dance forms, these compiled by a process of revival, reconstruction and composition in the years following the Gaelic Revival after 1897. 3. In Scotland the term indicates an on-stage concert or social night involving music, song and dance performance. history. The first ceili was held on 30 October 1897 (Feile Samhain) in Bloomsbury Hall, London. In pursuit of new activities for the London Gaelic League, the Scottish ceili evenings in London were visited. It was decided to use the same term 'ceilithe' for a London Irish social evening based on the structure of the Scottish evenings. The London Gaelic League were already using the term 'seilgí for day-outings.
Based on what was believed to be an old tradition, it was a piper, Tomas O Gearachain, who opened the proceedings at the ceili, followed by songs by Micheal O Suilleabhain and Norma Borthwick, and Scottish and Welsh singers and musicians. M.C. O Fathaigh strictiy controlled admission which was by invitation only. He also censored what songs were permissible; Phil the Fluter's Ball' was unacceptable as being 'stage Irish'. They were very conscious of 'breaking new ground' and the need to create a good image. Dancing consisted of 'Sets, Quadrilles and Waltzes to Irish music'. Those figure dances, now referred to as ceili dances, were not known at the time. Another landmark 'ceili' was the occasion of a performance by Frank Lee's 'Tara' ceili band at the Sarsfield Club, Notting Hill, London on St Patrick's Night, 1918.
The ceili phenomenon spread from London to Ireland and other countries. Subsequently the ceili became commercialised and came to consist more of figure dancing (known as ceili dances) and fewer songs and musical performances. The extreme popularity of the ceili gave rise to the need for specialist groups of musicians which became known as bands. During the 1950s and '60s, ceili bands attracted such crowds of dancers as to fill the largest halls in Ireland, City Hall, Cork and Mansion House, Dublin being packed to capacity weekly.