It strikes me that the 'songwriting' part of the title of this thread is a bit misleading.

We're talking mainly about the kind of editing and tweaking and cut-n-pasting that takes place in the folk process. I'd say that's a whole other thing to songwriting. Though in terms of the dialectic between the individual and the collective, it has quite a bit in common with it.

I read Greil Marcus' book "Invisible Republic" last summer, and it's really really good on this kind of discussion. It has some nail-on-the-head observations of the kind of collage aspect of the American folk process.

Basically he reconciles that whole false dichotomy of "individual subjective egotist songwriter" versus "collective objective egoless folk", showing it's dialectical. When a banjo player chooses which particular stock, collective folk-database line he wants to use in singing his song this time, about bats, or dead girls called Polly, or lost sailors called Willy, he is of course making a subjective decision - a 'songwriterly' one, if you will.