"music theory" is nothing more or less than
the collection of musical elements that are used in a particular kind of music, along with the rules for when and where they are used--when you learn to play banjo you are learning "theory" and when you teach banjo, you are teaching "theory"--

Parts of that theory include what the drone string is and how to use it, how to relate to the melody line to the drone, the rolls, and where and how they are used, as well what rhythmic and melodic elments that are used in the leads, as well as the rules for creating intros, fills, and turnarounds--you also have to learn what kinds of melodies work , and all of the conventions for improvising--

Of course, this is not your classical music theory, but it is theory, and without understanding it , you aren't going to get the music to sound right----