I think it boils down to the type and severity of the mental illness and how it is manifested.   You can be compassionate and try to accomodate, but you can't turn a folk club or concert series into a care facility. In the case of our concert series, if a presumably mentally ill individual was being disruptive and ruining the concert for everyone else, we would politely, tactfully but firmly ask that person's carer not to bring them back. If the individual was turning up on their own I guess we'd have to address it somehow, but he/she would be firmly but politely asked to leave and would not be allowed back. We are take the same position with young children. If they can't sit through the concert quietly we ask their parents to remove them. We can put up with some fidgeting but not disruption. This is an interesting topic, and of course every case is different. I have been in a couple of folk clubs in the UK where there were individuals who I could tell weren't quite 'right' and as far as I could see they were accepted and treated kindly. None of them was disruptive.