An idea that died a hundred years ago.

Well, it certainly underwrote a lot of the revival since that time, and subsequent assumptions in both Folk and folklore. And it lingers here too when people speak of The Tradition as some sort of tangible phenomenon that exists quite separate from the singers who are 'merely' part of it, rather than the whole of the case. It also exists in Jim's notion of Traditional Correctness, which I dispute ever existed because the evidence suggests something a good deal more fluid & feral than that. It's interesting how Outsider Art / Folk Art / Art Brut will coalesce into an identifiable aesthetic, but remain quite disparate at its root where it's invariably the work of very exceptional individuals. The Imperial tendancy to patronise the lower classes as a faceless mass - or at best a Proletrariat with revolutionary potential - is born out by the Traditional Hypothesis. I'm not immune to it though; neither have I quite written it off, just, like The Folk Process, I think we have to not only get to grips with the mechanism of the thing, but recognise that, as with biology, all music is determined by exact same processes. This doesn't negate Folk, just places the emphasis on a more musicological appreciation of creative idiom & species rather than a patronising ideal hatched across the gulf of class / cultural condescension and delivered from on high.   

member of a self-selected musical high caste. Nothing to do with folk music, as practiced right across the population by untutored musicians in their own homes, workplaces and social spaces.

That's a cosy view of things that returns us to a romantic notion of the sorts of people who just dabbled for the hell of it. From the collected evidence I deduce the work of master craftspersons on top of their art - like domestic knitters and gardeners to time-served coopers, ploughmen, brickies, wheelwrights, field surveyors, engineers, poachers... The tutoring was part of the time-served process of the thing, much as allowing for the genius of gifted individuals as we have today in any given musical community. Some people are just blessed and are high-caste artists by default - be they storytellers, fiddlers, pipers or singers; the canon is full of such people, and accounts of them and the supernatural accounts of how they came to be supernaturally gifted. I'm not proposing a selective guild any more than you see in untutored kids who routinely peel off heavy-metal pyrotechnics in the music shops of Manchester of a weekend. Music insists on mastery, and listening to Phil Tanner, Harry Cox, Ollie Gilbert, et al, that's pretty much what I hear & relate to with the same humble awe, quivering respect & reverence as I do when listening to John Coltrane. Coltrane was just one saxophonist of countless others who made it to top of his pyramid by drawing on the work of those before and around him; uniquely gifted, his work still resonates with us today in terms of its Tradition - much as Davie Stewart, or Seamus Ennis, or countless other untutored Folk Musicians who live on in Folk Memory alone.

*

Is 'dig' the sword a collier would use, or would 'cut'or 'hew' be a more likely usage.

You're right - I sing hews not digs; needs must I swallow my swords. Another line is Hewin and putting and keepin i' th' sticks - I ne'ver so laboured sin aa took up me picks. My favourite verse echoes the devil of TCR & some of the finest imagery in Northumbrian folksong:

The rope and the rowl and the lang ower tree,
The de'il's flown ower the pit wi them; he's away wi them a' three.
The rowl hangs above the shaft, de'il but it fall;
Twenty four horned owl run awa wi' the mill

Contracting the second line would fit it to the melody of TCR. I'm tempted to put it up on YouTube, but as I'm presenty wanting a front tooth (dentist tomorrow!) I'm a tad camera shy...