Many years ago, I heard someone quoted as commenting "It's folks that sing songs, I've never heard horses singing songs, so every song is a folk song".
I've always wondered why people should feel they have to categorise songs as 'folk' or whatever. Audiences want to be entertained.
In most of the sessions and clubs I take part in, any type of song will work, so long as the audience like it.
We often have Eagles, Beatles, Richard Thompson,and occasionally we have had some jazz classics. In between, we may have singer-songwriters testing out their new material, and instrumentals with pipes, mandolins, fiddles, and penny whistles. Sometimes we will have visitors from other countries, and they will sing songs from their own culture. When performed well, the audience is content.
When exposed to a range of styles and music, performers and audience of all ages and experience can expect to hear sonething new, and something different.
We also like to encourage newcomers, so anyone can have a shot. Less experienced singers can often only sing a limited range of songs. If they clash with what the audience wants, then it will be harder for them to get another shot. It's as simple as that.
If it's a good song, it should work almost anywhere. Good performers will be able to 'read' the audience and know when a song will or will not work.