"All of the other genres Jim mentions don't feel the need to do this so why should we do it with 'folk'?"
You have to be joking Steve - have you ever stood between two classicists arguing the toss about whether Tchaikovsky or Berg is 'classical', or jazzmen talking about the validity of Mingus or Brubeck compared to Beiderbecke or Ory?
Try advertising a classical concert at The Royal Festival Hall and putting on an evening of James Last.
All music has its definitions and sub-definitions and devotees who will fight to the last drop to defend them.
To a researcher, a large degree of precision in the terms used is vital to understanding and it is fairly important to the casual folkie who travels ten miles to attend a folk club one winter's night only to come away without hearing anything resembling a folk song.
Abandoning any form of definition is taking away an individual's choice of what they prefer to listen to and it makes communication between people wishing to discuss their music virtually impossible.
Food analogy again - it's like going into a greengrocers and asking for apples, only to return home to find you've been handed a bag of tomatoes (love apples).
1954 - can of worms here we come.
The International Folk music Council adopted a workable definition of 'folk music' that year, more or less internationally accepted but nowadays very much in need of repair.
Jim Carroll