Though if, as I suspect, folk song and country dance did exist as a minority interest hobby in the posh villages and toff manor houses...???

It's not a part of rural society we ever had had any contact with...

Probably depended on where. In Scotland, the toffs were so spread out that they could only have toffs-only gatherings while based in their city flats for the winter. On their estates, gatherings were much less exclusive. Elizabeth Grant of Rothiemurchus describes how it worked in "Memoirs of a Highland Lady", for the Eastern Highlands in the early 19th century.

Inclusive might not have meant fun. Most of the big ballads are heroic glorifications of aristocratic families in their petty sadistic feuds. You can bet their peons were expected to sit quiet and listen approvingly while the laird's tame bard went through 37 tedious verses of grievances against the landowner in the next glen.