I would certainly agree with those who say that the organiser was trying to let you down lightly although in doing so he was in danger of getting the sort of place that presents traditional folk song a bad name. Our club is called Traditions at the Tiger which should give some indication of the sort of music that you could expect to hear there. I have had people tell me that we are "too traditional" (they probably think that the BNP are too right wing as well) however none of the committee there would use the excuse that you were given to refuse a request for a gig. Having said that we are booked well into 2010.
BTW I once read a piece by Bert Lloyd where he said that no portable instrument is any more "traditional" than another.