Good, evil and magic in the world of the Palantir Commission

I realized after starting a Middle-Earth RPG campaign that the Middle-Earth universe, although very deep in some aspects, was also very shallow for anything that doesn't directly support the narrative of the canonical stories. The economy makes no sense, for example. The MERP universe merely has overlayed a D&D world over known names of places and beasts. I kept less than 10% of the content of the MERP module "The Palantir Quest": I'm redrawing maps, and essentially changing the nature of the adventure path altogether. The original module and adventure felt like an old Forgotten Realm module. This article is about reconciling fantasy and Tolkien's work.  Gelatinous cubes don't HAVE to exist in Middle-Earth, but there ought to be a way to have cool magic going on even when Galdalf isn't around.