Oombanjo, I agree. I always understood it to be a filmy eye, maybe from a cataract. If you've seen people with that sort of eye disease (it's rare now because so easily corrected), you would be very likely to describe it as a cotton eye. (Eye damage from misuse of household caustics can also produce that kind of look, I believe, though I'm no expert and could be wrong about this. Caustics were the cause of blindness for a good few rural people years back.

My, that Bugs Bunny clip is a good'un. I ask myself, how did Hollywood get hold of this old traditional song? Not sure who the soundtrack artist is, but it's a steam-powered version all right, and doesn't clearly derive from either of the commonly circulated pop versions of that era -- Burl Ives' or Bob Wills'.

I'm guessing the song turned up in California by way of a migrant musician, maybe an Okie but maybe not. There were a lot of people heading for Sunny Cal in those days to find fame and fortune, and California had a bushel of country artists who derived from the southeast, midwest and southwest.

Bob