Sang a rousing selection of shanties with my three year old this very morn JC.
The definition is an exemplar of its type, any record shop, radio programme or music magazine will codify folk music with extraordinary accuracy to people who seek it out.
OTOH there are folk song websites that provide traditional tunes played on what sounds like a Casio keyboard. As presented, they'd meet all the 1954 criteria and yet fail in contemporary descriptors of folk music and would clear any club within ten minutes. Therefore we have to deduce that the older definition is redundant or insufficient to supplant the working one.