Alan Surtees says,

"That folk music was, originally, of its day, not traditional, but pertinent to that moment in time, in the same way that pop music has relevance today. It was the only form of musical entertainment available to anyone. There was no competition and each country had its own musical style and its own instruments. Travel, conquest and trade routes would have introduced new styles and instruments across the continents and then across the world."

That's a pretty declarative statement that requires a response. The folk music of its day may well have been traditional as a folk song is like a tributary in a great river of song.
It usually is a variant of a predecessor and unlike pop music, not written for market.
One of the important ingredients of a folk song is its connection to another similar song that predates it.

The nature of folk music in a sense defies its commercialization by being in "show business" although that image of the singer/guitarist is the current association for people that haven't studied or listened to folk music very long. In a sense, the idea of "show bizzing" up folk is almost an oxymoron. Many really interesting performers of folk music are not professional entertainers but through field recordings and listening to them on back porches or living rooms, the essence of folk music is communicated. It might be a moving lullabye that a mother sings, a field holler by a African-American migrant worker,
the wail of a harmonica under a tree somewhere in North Carolina or Kentucky, two young women with guitars singing for themselves in sweet harmony which would be not interesting for an audience used to momentous production values, dry ice, loud mics or whatever is being sold today.

I think folk music will always have an audience but not necessarily a show biz one.
Even the coffee house has its own conventions wherein many traditional folk performers would not fit comfortably. Folk music by necessity has a social component that has little to do with performer/audience conventions. An Irish sean-nos ballad in a pub is closer to the real deal or a fiddler playing a tune for dancers in a remote area of Cape Breton.
This will never do on American Idol and frankly who cares? "Hey, folksingers are too pitchy, dog!"

Away from the marketplace, folk music still survives and always will.

Frank