I would like to take part in this discussion, and have WAY more to say on the subject than I can post now.
I will say, though, that music falls at various points on this continuum, and it doesn't stay at a fixed point, depending on when and where you are. IMHO, a lot of the "serious" western attempts at "real" world music that were done in, say, the 1980s and 1990s now come off as pretentious and humorless. Despite the intentions of the artists, the music is every bit as artificial as a Martin Denny record. But Martin Denny is a hell of a lot more fun and goes much better with rum cocktails.
I'll post more. This topic is of real interest to me.