Because the living or dead status of the author is an important consideration in what I proposed. If you want to use Shakespeare, then the 'dead' status applies. If you want to postulate a case invoking the 'living' status, choose a living author... its not like they are hard to find.
At least you admit you attacked a strawman. That's something.
I chose Shakespear because the movie Baz Lurhman gave us is a radically different interpretation that the author may have opposed had he been alive. It's hard to choose a living author when copyright law has disallowed concurrent interpretations of an authors work for so long.
Likewise, ACD may not have approved of the comedy interpretation of Sherlock Holmes in the last hollywood interpretation. Doesn't me we shouldn't have it just because the author likes it.
Lots of reasons. The most obvious one is that a highly derivative work is much easier to produce. Just as patents grant monopoly on production for the invention, so too does copyright. Creating a compelling and interesting setting, that catches mass market appeal is hard. Hitching your wagon to it is easy. Copyright should reward the hard part. That is the contribution to our culture. Theres no reason to go out of the way to skew benefit towards the low hanging fruit of highly derivative work.
So, your main argument here is that those who create derivative works profit when most of the work was done by the author of the original work?
That's speculation at best, and even then it's irrelevant. A derivative work still requires a lot of work to be good and allow people to like it and be anywhere near as popular as the original. It may be as popular or even more popular, and that could well be because it is better. In which case, why deny it from our culture?
The only reason is greed, and thankfully it's something that is going to be impossible to enforce in coming decades.