Hi Richie
As sometimes happens I don't quite follow your reasoning or agree with it. I concur that you have studied all extant versions which I have not and therefore you will no doubt have insights which I have not.

Having looked at the dates involved I am now more happy to accept Fowler's painstaking research. Also my knowledge of other ballads of the period (Dicey-Marshall material) leads me to believe, like many other ballads of the period, the hacks would find a skeleton of a story from whatever source (and sources are numerous and wide-ranging) and embellish it/spice it up with well-known pieces of folklore/superstitions. I think this is the more likely origin, but that's just my opinion and by all means include it wherever you like.

Very few of the ballad plots of that period are original. They are often taken from folk tales and stories from the continent and then given a local flavour by setting them somewhere real. In this case the bare outlines of the story came to the writer readymade. The hacks often spent their days in taverns by the waterside picking up stories from travellers: pick up a good story, knock up some rapid formulated doggerel, and off to the printers for your next night's drinking money!

Just remind you of an example I gave earlier: Bramble Briar/Bridgwater Merchant is very close to the 17thc English translation of the Isabella story in the Decameron. , (Minus the barmy head in the plantpot episode). I believe it was knocked up in Bristol in the middle of the 18thc and localised, hence Bridgwater.