The minute Tolkein up and died and his son aquired the rights they became his rights.  It's the copyright holder's intentions that are at issue, both ethically and legally.  The rest is a complete and total emotional argument based on painting his son as a real bad guy.  It's also about guessing the authors possible state  of mind and what Tolkein may or may not have decided if he were alive.  Not that I'm unsympathetic. I am a big fan too.  

Neither the Moria area nor Smaug would be copyright violations.  Why would you think they would be?

Understand that you are, with the above, in fact making the case for blatant copyright infringement.

It is because the Moria area (the Shire area too BTW) and Smaug make so little and trivial use or reference to Tolkein that they more than likely DONT infringe on Tolkein's copyright.

What does profit ... excuse me... legitimate exploitation of ones OWN IP like Achaea, TEC, Gemstone, MUD, MUD-II, Valhalla, DAOC, Ultima Online and the hundreds of other LEGIMIMATE businesses do have anything at all to do with IP theft!?!?!  

BTW, How much are they charging for a Diku-II license these days?

The moral equivocation of minor annoying issues and IP theft lessens the respect for IP.  IMO.