Al
It wouldn't be up to Steeleye to get the money to them. The way it works is MCPS collect royalties from them, and distribute them accordingly. So had Peter Kennedy registered for MCPS or whatever other body does the same, he would have had the money and honest man that he was would have passed it on in cash to them.
The reality is that as Dick said the amount was so small it would have been an insult, however it really depends how many records you press (or CD/s you burn) If you have a run of 50k it might end up a reasonable amount. The late Barbara Berry wrote a tune to a traditional song that was sung by a very well known young singer and received royalties accordingly.
The Gypsy Folk are not interested in any of this, and they don't do 'misinformed'. What they see is a band that had a hit in the charts and plays in big places full of people, singing one or more of their family's songs and they are getting naff all. That they see as another Gorgio rip off, and I am not the one who is going to try to tell them any different. So it got round like wildfire and they now set their price, and sing accordingly.
Come to think about it so do you, and I, and anybody else you care to mention. We also sing for free if the cause is a good one and guess what. So do they. I have gained their trust over 30 years and they know that their songs are not going anywhere they don't want them to go. That's why I sit on my recordings and only pass them on to those I trust.
Welcome to the wonderful music business.