"should guitars somehow disappear or were banned?"
Why should they - nobody has suggested it here - have they?
If any instrument is needed there are plenty more - the concertina, psaltry, hurdy-gurdy, whistle and flute (with a little help from my friends)... that are more versatile and lend themselves far more readily to narrative songs.
My reservation about guitars - all accompanying instruments really - is when they don't (accompany, that is); long, over-indulgent guitar breaks that the singer has to climb over to reach the next line, making it necessary for the listener to break into a run to keep up with the plot IMO don't help the appreciation of the song. Or when the singing follows the accompaniment rather than letting the accompaniment - well, accompany, making every song sound like a hauling shanty.
One of the worst examples of bad manners I have witnessed is when a song is sung in a music session and a musician (who may be listening to a song for the first time), insists on joining in. This happened recently at a music week-end with a melodeon player who, even after the organiser asked him to stop, persisted, totally nausing up several songs.
IMO too often the instrumentation of songs is the object of the exercise rather than the passing on of the song.
And then there's the phantom whistler.... but that's another story!
Jim Carroll