It's great to see someone else appreciating the "Folk'N Hell" album. I must admit I don't see it as Scottish Rock bands playing folk music but simply as Scottish bands playing music of different influences. In fact some relate more to dance music hence the sleeve note reference to "Acid Croft" I find that this approach augments the traditional style much more than some groups' "celtic ambient" music - all atsmospherics and no substance.
On the subject of can Heavy Metal music be played accoustically what about Stairway to heaven ( please no rock /metal debates) and particulary Rolf Harris's version. Was that ever a rock track? Even more interesting has any one heard the work of Dread Zeppelin ( Probably split now) who produced an album of Led Zeppelin as reggae. Similary, there is an English indie band Travis who do a corking indie veries of Britany Spears - Baby One Time
I find that labeling music gendres is only useful a starting point when looking for new bands, even then it pays to be broad minded