It does seem curious the music 'of the people' even people who no longer exist requires precise boundaries set from outside committees of experts.

Do you really have any experience of this? While there are people (fortunately very few) who want precise boundaries and try to get others to play music according to them, most people who play traditional music would be appalled by any attempt to draw distinct lines. In general, there is music that's traditional and music that's not, but the lines are wavy and imprecise and the gray areas are huge and very subjective. I'm glad to say there's no committee controlling what I play. If one were to try, they'd get a profane earful from me. The four times I've been accosted by the authenticity police have been very unpleasant, since they all chose to make their comments in the middle of a performance. The 1954 definition that seems to have you so exercised is a useful description of a phenomenon, nothing more. I'll keep saying this until you get it: It doesn't have anything to do with the actual playing of music.

That said, I will also argue endlessly with anyone who wants to call music "traditional" that clearly falls outside any reasonable gray area. I have heard a singer/songwriter claim to play traditional music because there is a tradition of singers doing self-composed songs with guitar accompaniment. NOT!