I would simply remove the last sentence.
"The term does not cover composed popular music that has been taken over ready-made by a community and remains unchanged, for it is the re-fashioning and re-creation of the music by the community that gives it its folk character."
A lot of songs enirely suitable for performance in Folk Clubs have been written since 1954, and they work just as well whether performed in a 'Stars in Their Eyes', 'tonight I'm going to be Ewan McColl', style or thoroughly folk processed , usually by failing memory inmy case, into new style. Removing the last sentence would remove the cause for the preceeding argument.
Cheers
Dave