I don't know, maybe you're just not hearing what I'm hearing. Watch Cory Henry on Snarky's Lingus. Jacob Collier do his recent crowd work with the NSO. Cory Wong talk about Vulfpeck and their MSG show and never rehearsing. Hiromi and Tank and the Bangas on NPR's tiny desks. I'd say Abigail Lapell adds tremendously to the folk of the era you are referencing.

Watered down is just not how I'd describe any of the musicians I listed