There's no such thing as the "Folk Police". It's a term used by people (often rather new to the game) who think that they are right no matter what, and that everyone who disagrees with them is (a) automatically wrong and (b) therefore some sort of fascist. Indeed, I've seen the term "folk fascist" used; but only, so far as I can recall, by people who showed no particular sign of knowing what they were talking about.

Anybody who believes that only "singer-songwriter" material can be "relevant to modern audiences" has a great deal to learn. It's often the case, though, that ignorance breeds arrogance and a determined unwillingness to accept the possibility that there may be rather more to things than we ourselves have so far seen. A person who feels that they are more important than those around them, and who is able to dish out criticism but can't take it, is liable to develop the kind of persecution fantasy that leads them to silly and offensive name-calling of this kind.

I don't remember hearing Kate use the term, but I would imagine that it was part of her stage-patter. She's too bright, I think, to take such things seriously.