What I have noticed.
"Old School" Audiences: Don't much care for singers who use tracks, ala Karaoke, and who don't play an instrument. Seeing a decent singer playing an instrument is what they expect..and seals the deal.

"New School" audiences: Don't care if the music is live or coming from an iPod in his or her pocket..as long as the singer is decent and the music is dance-able.

Then there is the "Dinner Music" audience, where a live player is required to play what we have been calling "wallpaper music". You play pleasant ditties very quietly. You think nobody is listening. No singing required. At the end of the night you are approached by folks bearing compliments and gratuitie$.

Just my observations.

Eddie