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For a character to be copywritten it must have been developed enough so that you can identify it by those characteristics. (E.g. A story about an italian boxer who makes it to a title fight is not enough. However, an Italian boxer named Rocky who yells "Yo Adrian" is enough to identify that character.) So, while a a white wizard might not be protectable, one named Gandalf would be - because the character has been developed and given enough distinguishing characteristics. If hobbits were around befor LOTR, Tolkein would have no claim to hobbits per se. But, he would if one of them were one of the more popular ones from his books.
Does this make sense? If not I can clarify and cite to case law if you like.
Copyright does not die with the author. The rights are extended to whomever he/she has assigned. However, once the work has fallen into the public domain you can do whatever you want with it. But, derivatives created from the original work do not expire when the original does. (e.g. The copyright on the recent LOTR movies will not expire when the copyright on the books expire.)
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