Actually, Marion, I'm not sure whether doing someone doing "music therapy"
who is not a certified/licensed music therapist constitutes "practicing
without a license" or not.   In the field of clinical/counseling
psychology or social work, there are licensed psychiatric social workers,
clinical psychologists, licensed family therapists, etc., but many people
(ministers, etc.) do "counseling" without violating the law or professional
standards.  Someone who is a licensed "music therapist" may have a
more definitive answer.  But to me the difference between "music therapy"
and "entertainment" -- in the contexts in which I do the two, overlapping,
kinds of activities -- has to do with the purpose and, to some extent,
the method.

I (and the activity directors) call it "music therapy" when the
goal is to:

 -- promote physical and/or emotional/mental healing
via the music,

 --  actively engage and stimulate the residents'
memory. general cognitive functioning and emotional responsiveness,
etc.

 --  help develop or maintain skills that will carry
over to other aspects of day to day living.

Sometimes I do this one-on-one.   (And, God! do I wish
the homes had the budget to afford the 20- to 30-minutes of one-on-one
with an individual resident!)  This can involve singing songs
from someone's early childhood. native language, religious background,
etc., or songs that  have strong associations with other important
t imes in  their his tory.  It may also involve getting them
involved in singing along, doing rhythm accompaniment, "dancing" to the
music, or telling the stories that the music evokes.

In group sessions, my goals include getting folks to engage their memory
skills (e.g., recall memory, learning new refrains). rekindle emotions
that they may have lost touch with, laugh, move, talk with each other,
reaffirm their own competence, etc.

Programs that  are geared to entertainment may accomplish
some of the same  goals, but their main purpose is just that
-- diversion.    Often in a happy hour or when playing
background music for dinner,  there is no expectation that anyone
will even pay any attention to the lyrics I'm singing.  The goal is
primarily to sound good and make the music enjoyable.  The
songs don't have to be ones that the residents already know or that have
special significance to them.  If the AD hires Irish dancers for a
St. Patrick's party, there is no expectation that this kind of dancing
will evoke childhood memories,  directly stimulate cognitive skills,
etc.   It's something that folks enjoy, and that is important
in and of itself.

Here's an aside that may (I hope) make the point:

I have a doctorate in [life-span] developmental psychology (non-clinical)
and some post-doctoral study and employment in counseling.  I cannot
call myself a "clinical psychologist"  or "psychiatric social worker,"
or any of several other kinds of specific occupational names, since I do
not hold the relevant licenses or certificates.  But I have been
employed as an adolescent and family counselor and mental health therapist,
under the auspices of agencies for which I worked in those capacities. 
As I see it, if the Recreation Therapy Director of a nursing home hires
me to do one-on-one music therapy   (e.g., by getting a native-born
German lady to sing the songs of the old country with me or by having me
sing special hymns to help a hospice patient  and their family deal
with impending death or by stimulating Alzheimer's patients' memories and
emotions via oldies sing-alongs), what I do is music therapy.  This
does not qualify me to do all that a music therapist might be required
to do.  But I may be every bit as capable of doing certain kinds/aspects
of music therapy as are those who hold licences in the field.  
(If I prescribed drugs, I'd be guilty of practicing medicine without a
license.  If I told someone that their health would probably improve
if they got some exercise, avoided overeating, and tried to sleep at least
6 hours a day, I would not.  And if I told someone about the results
of medical studies, I would not. )

I don't mean to disparage those who have specialized in music therapy
and become certified.  Still, there is a phenomenon in American society
that  I find rather troubling -- namely, the piling on of time and
monetary hurdles to anyone's making a partially parallel move career-wise. 
(If I wanted to get a job as a nurses aide, despite my extensive educational
and employment backgound in the psychological and medical fields, I would
still have to take a number of hours of course work, at a considerable
expense.)  Getting certified in music therapy would cost even more
in time and money.  Usually, there is no way to "proficiency the course,"
as we used to say.     If it were simply a matter of
acquiring the important skills and knowledge and demonstrating them, personally,
I would go for certification in music therapy.  But I'm not at all
sure it would be worth the time and tuition money to enroll in formal courses. 
Some music therapists have told me that folks like me make as much money
ast they do, without the certificate.

Any other opinions, on either side, are most welcome.

Genie