making rock instruments should definitely be as awesome as it sounds, and not ho-hum like it currently is =)
More relevantly:
Since Toady is aiming for ~14th century and earlier, the following would seem to represent the styles reasonable in DF:
Troubadour/Jongler - poetry, often accompanied by music, on one of three themes: war, honor, and love. There's particular metrical requirements. Originated in Provence 12th c, and spread through (modern) France and to England and Italy (and probably Germany). A Troubadour composes and performs, while a Jongler only performs. A troubadour also tended to be of nobility. (Something for those consorts to do?)
Epic Poetry - Multiple forms of epic poetry as a performance event existed during the relevant historical periods, most notably germanic and gaelic forms. The germanic variant appears to have been entirely in verse, and has particular assonance/consonance requirements with somewhat looser meter. The gaelic had set metrical parts interspersed amongst a spoken story. Both were often accompanied by (minimalist) music.
Period Instruments:
Harp, fiddle, rebec, psaltery, dulcimer, hurdy-gurdy, viol, flute, trumpet, pipe, shawn, recorder, bagpipe, crumhorn, gemshorn, 'lizard', drum, cymbal, triangle, tamborine.
Obviously, only some of these are suitable for solo performance.l I might recommend harp, fiddle, viol, recorder, and bagpipe as a useful set of instruments.
Group performance could involve quite a few people, and would likely be disruptive to DF, so is probably a bad idea...
And of course, comedic performance and similar occupied the same niche as musical performance in the time period:
Jester - jokes, humorous situational comedy, etc...
Juggler - same as modern, probably smaller repetoire on average, but would have also included 'magic' tricks and the like.
Mummer - masked or costumed merrymaker or dancer
Strolling Player - a wandering actor. Would typically perform scenes from famous plays, generally during the off season when work doing a full play was scarce.
So, our performance dwarf list might look like:
Troubadour
Jongler
Bard (epic poetry)
Harpist
Fiddler
Violist
Recorder player
Bagpiper
Jester
Juggler
Mummer
Player
Dwarves could like any particular type, although disliking a particular type would be a luxury that would be uncommon in the time period. (That is, even your least favorite would still be preferable to no performance).
Some of these should be wandering professions. The artist might arrive at your fortress, perform for a season or two, and then wander off. Of course, your nobles might be willing to spend fortress wealth to retain them for longer if they really liked them (need a better concept of 'spendable fortress wealth' probably), or even sponsoring them long-term.
A troubadour in your fortress should increase the number of jonglers who visit over time, as they come to learn whatever new material he is creating.
Artists should have a 'fame' rating, especially troubadours, jonglers, bards, and players, but likely also musicians, and the remainder to a lesser degree.