The 1954 definition was intended for use by academics, to set out parameters for academic study. It was never intended to define what should be sung in folk clubs, or in which display rack to find albums in record shops.

Also, language has moved on and "folk" has a much broader meaning than it did in 1954. Nevertheless I still find it useful, if only as a guideline rather than a strict "definition" of a particular type of music.

I see a difference between, for example, "The Outlandish Knight" or "Seeds of Love" being sung by an old man in a pub and "My Way" being sung by an old man in a pub - even when its the same old man and the same pub. That distinction is siginificant to me, even if it's hard to pin down, let alone define. I feel the difference is sufficient to justify giving them a different name - whether that's "folk" or "traditional". Of course it's equally possible to see them both as part of the same thing - the two views aren't exclusive. I just don't think it's helpful to conflate "My Way", or jazz, or opera, into "folk" simply because they may be performed in a certain environment.