It seems likely that whatever CD of folk music you may recall was likely to have been produced by the UPE recording company. They are quoted as saying, "Before UPE began, there was hardly any Latvian traditional music on CD, and none on a Latvian label. What had appeared on vinyl or cassette before 1991's independence bore the heavy stamp of Soviet approval, and after it Latvian musicians struggled financially to release anything at all." You can find their catalog here.