"Now consider who's appearing at virtually every folk festival, and tell me that they don't fit that description. "

They do not fit that description.

To begin with, if commercial interests were the major criteria, they would not be performing at a "folk" festival. The music comes from past traditions - a more recent vintage that can be traced to the folk revival and the community that it spawned.   Even though there are known authors, the music evolved from a singer-songwriter style that can be traced back to artists like Woody Guthrie. They also use the form of traditional music. Some use the form and update it to reflect changes in the culture.

" "Folk" is NOT a value judgment."
I would think we are all in agreement on that.


"To me, "Folk" (at least as far as it goes in terms of professional performance) would suggest a strong connection with the style (and type of content) of past traditions."

The only issue is that most professional performers have very little connection with the past traditions other than as students or observers.