You can choose to play in whatever key you wish at a session but it all depends on how inclusive you wish things to be.

The great majority of Irish tunes tend to be roughly based on "G" or "D" while in Scotland it's more likely to be "D" and "A". Of course, this includes all those which are in closely related modal and/or minor keys and so it's not quite as simple, as most guitar accompianists will (Or ought to!!!) know.

Even then, there are many popular tunes in other keys such F, C, Bb,Gm and so on which are still very common in many sessions. So, they are certainly, not all excluded.

It's not really a big deal to be able to play tunes in a less usual key if you know your instrument well enough.
However, I find that it's much easier to do this with those tunes I've already learned in these keys rather than have to do this "on the hoof" so to speak.
So, perhaps, this is where the problem arises for most people when it's more difficult to pick up these tunes and play them "on the fly" in a session situation when the keys are a little more unusual.

It's true though that traditional music has been played in a wide range of keys historically. For instance, the clarsach is usually tuned in Eb and there are many tunes arranged for this key and Bb which just involves chaging the A levers(from flat to natural).