We've discussed what is folk music, but maybe it'd be just as appropriate to discuss what is meant by electric. I play bagpipes (obviously by my name, lol!) When I play with my guitarist we try to craft our tunes, which often means that Jonny picks a counter melody. The only way he can be heard is if he uses a little amp. We use it incredibly subtly, turning it off with a pedal when he's strumming.
We do often get asked not to use the amp at clubs (getting disqualified once from a competition because of it). We will always use it and afterwards get any number of people saying wow, that's an amazing guitar, it's so resonant, showing that most of the time people don't even notice it!
My point is really, yes, a lot of the time amplification is a pain on the neck and done badly really gives electric a bad name.
We like to play nice music with counter melody and harmony, but it just can't be done with guitar and bagpipes without some kind of amplification on the part of the guitar.
I ask this in the nicest possible way, what would you do?