I'm not sure you can back up your assertion that this doesn't happen in other areas of art. I mean look at the film industry for starters, where remakes seem to be at least fifty percent of Hollywood's output. If you include film adaptation of works of literature, comic books, plays, etc. . . it's rare to find a completely original film! In literature there are many books that use other books as a source, for instance Ahab's Wife, and i think there has been at least one reinterpretation of Gone With The Wind. In visual art, especially amongst today's "postmodernists" sampling imagery from the past is a common practice. Many people have done exactly what you say would be "laughable" - recreating and reinterpreting works like the Mona Lisa and the Thinker in new media, with serious artistic intent. In other words, I don't think music is unique in this way, but folk music is an interesting case . . .   
Rev