What defines `traditional?' Mass consensus, I'd say.
Take Taekwondo. These are the facts: a massive review of its history, based on the work of Burdick, Henning, Capener, and a number of other historians basing their conclusions on what evidence exists rather than romantic longings and fantasies, has established that at the time the Kwan founders went off to Tokyo to learn MAs, there was nothing being taught in Korea that was remotely connected with anything particularly ancient in the way of fighting arts on the Korean peninsula, or even harmless foot-wrestling games popular in the early-to-mid 19th c. The only arts practiced in secret in the hills, by this point, were probably
Japanese—the jiujutsu that was taught by Japanese MAists in occupied Korea around the turn of the century, but then forbidden during the teens and 20s as the Japanese sought increasingly to disarm their subject colonies as part of the increasing militarization of attitudes on the main islands. The Kwan founders went to Japan in the 30s, came back with Shotokan and Shudokan karate and tried to open dojangs during the war, and finally managed to during the Korean War era. It was at this point that what is often called `traditional' TKD was born (see, for example, Doug Cook's recent book, titled... what a surprise!

...
Traditional Taekwondo). But what is traditional about it? It was a Koreanization of Japanese modifications of an Okinawan synthesis of indigenous te grappling/manipulation techniques, samurai budo practice and Chinese chuanfa, itself no older than Bushi Matsumura and already seriously modified by Gichin Funakoshi, Choki Motobu and other expat Okinawan karateka in Japan. And by the early and middle 60s, `traditional' TKD was already undergoing modification, under pressure from anti-Japanese attitudes and international sporting ambitions, in the direction of the martial sport—radically distinct from anything like an effective combat art—that would culminate in Olympic TKD.
A similar story can be told for Japanese karate. And cases like this make me wonder just what useful semantic content the term `traditional' conveys. I see the word as, potentially, a potent component of the mystification rampant in the MAs, with phony, completely invented lineages and flim-flam based on bad etymologies, bad history and fantasy-based agendas.
But maybe this isn't all that surprising. A lot of things in a lot of other domains are regarded as `traditional' which turn out to be relatively recent inventions or innovations. I suspect `traditional' is mostly a marketing term, intended to make us feel good about something someone else is trying to sell. Caveat emptor.