I think you hold the words of poets as being too sacrosanct, especially when it comes to (dare I say) second- or third-tier poets like C. Fox Smith. Inspired, yes; gifted, unquestionably; infallible, hardly. Considering her output, she hardly had time to labor greatly on each line and word choice, and it shows. So there's still room for improvement, even if purists will object that any variance is some corruption.

The necessity to rhyme also lowers the bar somewhat—in reading rhymed poetry one is often struck by overly contorted sentence structure or infelicitous word choices. With free and non-metric forms, one can make a much stronger case that the poet's words should not be altered; that they say just what was intended in the form intended (even though any honest poet would scoff that such a goal is ever achieved).

In the conversion of a poem into a song, one also has to contend with what is lost: punctuation on the page, a large degree of intonation in recitation. It's often desirable to rephrase passages for listeners who have no opportunity to rescan for sense or even pause for reflection.

One also has to consider whether to replace outdated, obscure, vague or colorless verbiage, discriminatory sentiments, and expressions which might now be laughably misconstrued. I've run into all these problems in setting old poems to music.

When Charles Ipcar (Charlie Noble on Mudcat) has posted his settings of CFS's poems, he's almost always posted her original versions as well, even when they'd been posted previously. He has never portrayed his settings as completely faithful. Few other setters have been as forthright about their changes.

As to whether an altered version should be classified as an adaptation rather than a setting, that's a highly subjective call, which depends on the extent and nature of changes.