This is the point. Is the folk music YOU like an act or a social occasion? If I'm selling a product to somebody, I'll try not to offend their expectations, but if I'm doing it for myself and for my mates, I know what I like and I know what they like. And few people have the right to tell me what to wear when I'm enjoying myself.

As for playing a varied repertoire, being in tune, etc. let's go back to the OP and unpick it.

In order to succeed any artist must in my opinion as a minimum:-
1.       Be technically very competent.
2.       Ideally have some unique characteristic
3.       Pursue a relentless campaign of publicity and networking to maximise exposure
4.       Play what the current market wishes to hear
5.       Be persistent and get lucky

(1) Must "any" artist set out to please the public?
(2) Technically competent is a relative thing and socially determined. Just listen to certain old ecordings of revered performers, in folk, skiffle, pop, etc., and you'll see what I mean. Is it possible that over the years the "folk" listeners have had their expectations changed by he media, to the detriment of "folk" as an independent way of doing music?
(3) There are many ways of doing "art", and these include maintenance of tradition as well as pursuit of perfection and innovation. Which ways are appropriate for what you mean by folk?

The last three points apply to marketing of any sort, and presuppose that "any" artist has to be commercially motivated. But historically, at least in the UK and Ireland, few traditional artists have been so. You can actually read the change happening in the Chieftains' biography by John Glatt. The first half of the book depicts young enthusiastic musicians hastening from work to play music; the latter part is largely a namedropping catalogue of celebrities they met after success.

Would any sort of "folk" survive without the professionals? Probably not in the UK, where society is far too fragmented to have a cohesive sense of demotic tradition. But Scotland and Ireland would probably be fine. America?