I think you're right, Dave the Gnome- young folks have gone elsewhere- thriving informal sessions, festivals, clubs of various kinds, not to mention the time-waster of social media (another form of SM behaviour (IMHO)- they have different ideas
Older folk do continue attending folk clubs, I believe, although I haven't done any recently & haven't lived anywhere near one for thirty years- I probably would be very particular about which one I attended as there is a huge variety of approach. Both Jim & the Sandman are aware of my preferences & I've no wish to get into that argument again!
No I'll just carry on doing the very occasional folk club & festival, but my preference will always be outside that, preferably in a non-folk social context, like a good pub or daycentre.
On the subject of folk songs & drawing lines, I'm totally with patriot's recent post & Jim's description of folk songs being written at some stage & then heading out into the world & changing/developing via the people is an interesting one.

I'm of an age where some pop songs still told a story (one definition of a ballad) & have sung such as 'She wears Red feathers' in my own way with melodeon accompaniment since I first heard Guy Mitchell's version. It may be non PC but that's irrelevant here. My current version bears little resemblance to the original 78 so has its progress through the folk process (mainly me- I am a person) made it a folk song?
I also sing 'that great old song 'As time goes by' but not from the Casablanca version. No, there's another stage- I got it from the Boldon Banjo Band- my uncle Tom played piano with them in the Boldon Lad pub for many years. Even more folk process, and again developed by the folk (ie ME) so again is it now a Folk song?- not that I give a damn what it is, I just hate all this pigeon holing & line drawing, it's prescriptive & am not happy about all this definition- one reason why some folkies have gone elsewhere, TO GET BACK TO THE SUBJECT.