There was an ugly xenophobic She-ain't-country-she's-from-Australia undertone to the whole thing. Fortunately less-bigoted minds prevailed, and Olivia won the award.
But the controversy over just who and what is country keeps raises its head. I have heard people dispute the "countryness" of Martina McBride, Mary Chapin Carpenter, Garth Brooks and many others.
I can be quite the purist myself sometimes; Son Volt has been featured in CST but for my nickel they're a rock band - a good one, but just not country. And it has nothing to do with where they're from, but what they choose to sing about.
On the other hand, one of my favorite country songs of all time is "What it Takes" by Aerosmith. I'm not suggesting that big-lipped band from Boston is country, but that song is and it's obvious from the first line ("There goes my old girlfriend, with another diamond ring").
I may not be able to define country but I know it when I hear it. So do you. So why don't we just leave it at this - if you're a country fan and you like it, it's a country song.