Unfortunately, "folk art" as used by much of the art world today has little bearing on the folk art of which Yeats spoke. Traditional folk arts such as coopering, saddle-making, pottery and weaving have always exhibited high levels of craftsmanship. The skills haven't been learned in formal educational environments, but the craftsmanship needed to properly create the work has been learned and perfecting that crafstmanship is a lifelong endeavor.   

Today, "folk art" is often used as an umbrella term to cover the work of "artists" who simply haven't taken the time and effort to learn good craftsmanship. Primitively executed paintings on scraps of corrugated roofing material are passed as "folk art" at art shows everywhere. Far too often, the "folkiness" of the art is mere contrivence that let's the artist get by with inferior craftsmanship.

It's analogous to the difference between an accomplished traditional fiddler whose skill level rivals that of any classical virtuoso, and a lazy guitarist who says, "I play folk music. I only need to know seven chords."