Having just re-read this thread in its entirety, it seems that generally we (the Folk Community) have successfully "passed the mantle" on to the next generation. The overall perception however is that the emphasis has changed:

a) Away from the songs to the music.
b) Away from the traditional clubs, to "more open" venues (festivals etc).

I infer from the understated comments that most of us have tried (and failed) to make traditional club venues more open and we haven't yet found a working method ?

I live and work in Cambridge (UK), and neither of the folk clubs see much of a student audience, yet as I said above the Waterson:Carthy gig, at a non-club venue, the audience was 150+ people, I'd say about 25% students and almost no-one (ie ME) from either of the folk clubs. Tickets were 10 UKP per head (about twice what a club would charge), and that's a lot of money for a student. I'm pretty sure that if a club put them on 150 different people would turn up.

Controversial Generalisation (NOT a complaint!):
From what I see at festivals etc. I'd say the youth audience wants to jump up and dance to shitkicking diddley-diddley^TM, and a lot of the young bands want to see this reaction. You can't do that in a folk club!

AndyG