I'm entertained by much of this discussion, especially Sedayne's metaphoric post. So guess what? You're all entertainers.
Would TheObserver's question be a bit more clear or less controversial if it were phrased something like:
"Within the realm of Folk Music there seems to be conflict between those who focus on Entertainment and those who focus on Scholarly Preservation of Tradition. Do these two aspects need to be in conflict?"
Most of us who actually perform folk music - rather than restricting ourselves to sitting in the audience & listening or poring over scholarly texts - have at least a little interest in knowing the history of a piece, a little interest in keeping alive something old/"traditional", and also some desire to enterain our audience (even if that audience is merely ourselves). So it's a rare person indeed who is entirely at one end or the other of that spectrum. But we each may find a different balance between.