It's fair to say that the seperation of folk music from folk clubs is a good one. Folk clubs were in direct line from the singing rooms of the 1850's, through Music Halls to the 1960's. They are in a line of tradition in terms of entertainment that goes back nearly 200 years. This tradition of "come all ye" entertainment will survive as it is part of the human spirit, as will the academic world of folk song and its history.
Personally, I'm much more interested in the working class thread going back to the singing rooms. I have a diary of one of the performers of those days and his life was not dissimilar to the life of a folk club pro.
Having lived that life I value what it has given to our culture in terms of songs and humour.
Yes, it's dying now, but it will be reborn in a new way because people need what it offers, music, laughter, community and continuity.