Wade - that's a lovely summary of the history of the fretted zither in the US.
I have never seen a nyckelharpa being played during my trips to Sweden. I was last there last September leading two week long wilderness canoe trips down the Harken river system for people living with cancer. I saw a few Swedes trying to hunt moose but none with weird folk instruments.
I did see a Hardanger fiddle player a few years ago. I was leading a group ski touring across the Hardangervidda and we were entertained at one of the mountain huts by a local fiddler who was staying their. The hut had been open for 100 years and we happened to turn up on its birthday! One of our group was a very good old-time fiddler so she played Coleman's March on the guy's Hardanger fiddle.
I can see why the Scots-Irish copied the concept of European zithers they saw and made their own instruments. The mountain dulcimer is such a simple thing to make. It would have been easy to source both piano wire for making strings and broom wire for making frets at hardware stores in the mid 1800s or through catalogues (the internet shopping of the time!). No special tools were needed and you can set frets in just intonation VERY accurately by ear using two strings.
We have never had a traditional fretted zither in Wales, although many types are found throughout Europe. Well, until now that is. I finished my second Bocs Can Idris (Idris' song box) at the beginning of lockdown:
It is a new traditional Welsh fretted zither (well, tradition has to start somewhere). Just before lockdown my friend (guitarist) and I entered the local Eisteddfod and won! I played old Welsh dance tunes on the first Bocs Can Idris I built with guitar accompaniment. I have built sympathetic drones into the Bocs Can Idris, which give the instrument a bot of natural reverb. Having seen the nyckelharpa it has given me some ideas for future mods!