Oh dear, that old slur about 'folk police' again! I've been interested in trad. song for 37 years now and I've never known anyone who has been 'banned'from a folk club for inappropriate repertoire; I've heard a few rumours, though, of people being banned for inappropriate behaviour!
Personally, if I was a club organiser (which I'm not), I would be very loathe to ban anyone (I'm far too polite/well brung up/cowardly(?)for that!) - but having said that I wouldn't necessarily condemn anyone who did ban someone for inappropriate repertoire. In my youth the greatest virtue that one could display appeared to be something called 'musical eclecticism' (=broad tastes in music) but I noticed that many of those who declared themselves as being 'musically eclectic' had a tendency to sing anything but folk song in a folk club - and this really pissed me off - to the extent that I began to question whether 'musical eclecticism' was a good thing or not. I now think that it is not good at all - especially in the context of folk clubs. I would like to proudly declare that I am extremely prejudiced when it comes to music: I hate all forms of modern, commercial, popular music with a passionate loathing ('post music noise' as the American writer, Harlan Ellison, so aptly describes it) and I am equally passionately in favour of traditional song. Obviously, this attitude puts me in a very small minority - but I don't care! Nevertheless, I am not a policeman - I would never tell anyone what they should or shouldn't sing - but if you come to any of the clubs that I belong to and want to perform punk/thrash metal/hip hop/plip plop/ folk fusions (or something) just don't expect me to be enthusiastic about it!!!