A more complete dictionary would include quilt as a verb -- the action of stitching together 3 layers of fibers or fabrics in a utilitarian and / or decorative manner.
I do think there is value in making a distinction between patchwork and quilted works -- just for clarity of understanding, not as a value judgment on the works themselves.
I personally do not care a whole lot about drawing lines between utilitarian and decorative function -- there are a lot of fine lines not worth quibbling over there.
I do think that the skills and commitment that go into making a full sized quilt that can be used for years on a bed -- that is a different level from the efforts that go into making a pleasing place mat or mug rug, or even "stroller quilt" which you see a lot of people cranking out. They're lovely and fun, and worthy of praise, but they are not the same achievement as a full sized quilt. It's like the difference between a jaunty little limerick and a finely crafted sonnet or epic poem.