The term was certainly in use in England in the late 1960s - early 1970s. It was used fairly loosely, but would probably be made up of people from the folk song and morris side of the folk scene rather than "proper" dancers, and would probably involve one or two song spots or morris displays. This gradually evolved into a more coherent movement and the word "ceilidh", and more recently "English ceilidh", came to signify not just a certain style of dance and music but also an attitude, diametrically opposite to the D4D crowd.

Many English people outside the folk scene, if they have experienced folk dancing at all, will understand "ceilidh" in this sense. It does occasionally cause confusion amongst ex-pat Scots or around Burns Night, when something more kilted may be inferred, but usually people know what to expect.

English has always borrowed words from other languages, including Gaelic, and often changed the meaning from the original, so this is nothing new.