While reading something about Newfoundland separatism, I came across this passage which struck me as rather neatly offering a way of sidestepping the endless arguments about what and isn't folk song:

http://www.ucalgary.ca/hic/issues/vol4/1#1
History of Intellectual Culture at University of Calgary
Volume 4, No. 1

Vernacular Song, Cultural Identity, and Nationalism in Newfoundland, 1920-1955

...The term "vernacular song" is used here as having survived longer than its initial spell of popularity, and has entered oral tradition, thereby demonstrating its appeal to more than one generation. Such songs vary in character: some are traditional (in the case of Newfoundland, anonymous songs that were brought by immigrants from their original homeland), some have new words set to traditional tunes, some are broadside ballads (the authors of which are usually although not always unknown), some are the work of (known) singer-songwriters, and some are texts set to music by a composer other than the writer. To become a vernacular song, a composition must not only possess a good tune (a "vital melody,", to use Frank Kidson's phrase), but also have words that strike a chord in the hearts and minds of listeners. Because they have stood the test of time, vernacular songs can tell us something about the beliefs, values, and opinions of those who were drawn to them sufficiently to keep them current for generations.