Maybe the sound problem is due to hiring in soundmen who are more used to PA-ing rock bands than acoustic music?

At the Gainsborough Festival, we use the soundman and rig that Amazing Blondel use for UK gigs - not cheap, but very experienced in amplification of multiple voices and acoustic instruments played by very pernicketty and demanding musicians. Result? Wonderful, crystal-clear sound at sensible levels. Every artist we've booked has been highly complimentary about the high-quality of our sound, and we've never had a complaint from the punters about volume.

Maybe some festival organisers need to be more selective?