Richard, this melody is delightful! It has many of the same qualities that have made the Early American folk tunes stand the test of time. I applaud you for that!
The three Ti’s in the melody at measures 5, 6, and 7 are the only thing preventing it from being a pentatonic melody. This is something you could experiment with if you really wanted to embrace the folk qualities of the melody. I also feel that measures 5, 6, and 7 are possibly a weak spot in the melody.
I would also agree that a less chromatic harmonization might suit the melody better. That said (not to discount Lynn’s input) I do think that pedal tones can be very effective in a more folk-like setting. Alice Parker, for instance, did this a bit in some of her work. (I highly recommend studying her work, btw)
1 other spot in the melody that I would consider is the opening 2 measures. You’re basically arpeggiating the tonic chord. While I’m not saying this is bad, I think maybe something slightly more melodic would “sing” more easily and also strengthen the overall melody.