"Or are we talking folk with a bit of lecky guitar? Isn't the/a point of metal to prioritise volume at the expense of melody?"

No, there is melodic metal, like Thin Lizzy. Folk metal is also very popular in Eastern Europe. There is a metal band of Russian Israelis who play metal versions of Yiddish songs, and a whole slew of Russian and Ukranian bands. Plach Ieremii is a fantastic Ukrainian group. They don't perform folk songs per se, but the music is heavily based on western Ukrainian and old Church Slavonic motiffs. Lots of acoustic guitar and cello.