In my opinion, what killed the folk clubs was punk coming along just at the time when the core folk club audience was getting bogged down with families and careers and had less time on their hands. The next generation for whom the folk clubs might have provided a natural outlet turned to punk instead.

I don't think the move to larger concert venues helps. It is probably a commercial necessity for the performers, but I don't want to sit in a large auditorium. Folk is intimate music, and I want to see the whites of their eyes. It also creates a barrier between the performer and audience, whereas in a folk club we are all together.