Bluegrass was commercial music, developed to give war/post-war audiences who wanted to see hot jazz soloing and hear tight vocal harmonies, really as much a business decision as a creative one, according to those who played it.

Jazz soloing was nothing new to Hillbilly music, Western Swing was, after all, swing--and Jimmy Rodgers recorded with jazz musicians and played blues--for that matter, the banjo itself was a jazz instrument, and the technique had evolved from 19th century rags--

I grew up in a Midwestern factory town, a lot of the folks had come from the South to work during WWII, and they brought their music with them. The old time Hillbilly musicians that I knew were much more sophisticated in their musical abilities than the folkies of the time who imitated them, and knew and played jazz/pop standards along with the old time stuff. Banjo pickers often played both tenor and 5-string--but tended to play guitar because banjo had gone out of fashion, and the "bluegrass revival" had not yet begun--

As to my preferences, I am listening to Grandpa Jones right now--make of that what you will--