I take Christopher Tolkien with a grain of salt. He was one of a very select number of people who got to see Lord of the Rings in its draft form, in addition to helping his father create the maps and chronologies of Middle Earth, so he has strong feelings of nostalgia for Lord of the Rings, in addition to being the sole conservator of his father's writings.
Having said that, I think that most of his "objections" to Peter Jackson's take on LOTR are based solely on money, which I can sort of understand. If I had written a seminal fantasy novel that got turned into a multibillion dollar film franchise, I'd want a piece of the action too, but I think he is not seeing the forest for the trees, which is that before the films were released, Lord of the Rings was read mosty by lit geeks and serious fantasists.
Nope. Their objections were not based on money. That said, there was a legal disagreement between New Line Cinemas and the Tolkien Estate given that a percentage of the profits was promised to the Tolkien Estate (who, as it turns out, donates the vast majority of income from all Tolkien-related works to various charities; their major activity is deciding how much to give to who). New Line claimed repeatedly that the films made no profits whatsoever, so they didn't have to redeem their commitment. This claim seemed implausible to the Tolkien Estate ... (seems rather implausible to me, for that matter!)
I saw a list of charities supported in 2007 - I won't dominate the thread with the list, suffice it to say that there 135 charities supported that year. The Trustees do not even draw expenses.
The "it's all about money" line has been peddled very successfully by fans of New Line in the past and is in my opinion a very obnoxious and unfair one.
The complaints are that PJ lost a great deal of the characterisation and themes of the novels in his adaptation and overdid the "dumbing down" factor and overdramatisation. And it got worse as the films went along.
Obviously there are changes that have to be made to a story in translating from one medium to another (for example, very few people would quibble about cutting Tom Bombadil). The more egregious changes (wizards duels are of the format "Crouching Gandalf, Hidden Saruman", the riding of falling staircases, changing the Ents story to incoherency, changing the motivations of Denethor from complex and haunted to simplistic insane baddy, the dominance of Theoden being pure magic spells, the Chariots of Fire orc, Gimli becoming stupid comic relief, the loss of any need for the charge of the Rohirrim by the magic assault of the Dead, Sauron the Magic Lighthouse, the loss of any depth to character after character are merely the first things that spring to mind) are the issue.
The problem I had is that through much of the movies, there are flashes of how the film
could have been done right. The visuals were largely superb. When we had the Nazgul searching for Frodo in the Shire coming across him and having him hide - the distortion of reality when the Nazgul was approaching was the kind of subtle yet visual trick that could have been used so well throughout.
Unfortunately, whenever you critique the movies, film fans come back with an insistence that "changes have to be made to a book" (yes, the critique is on stupid changes), "the films are far more popular than the books" (yes, and "50 shades of Grey" is far more popular than ah.com. Doesn't make it a better read), and inevitably "What, do you think it would have been better if Tom Bombadil was involved?" (No, he was cut even from the excellent BBC radio dramatisation)
Afterward people watched these absolutely spectacular looking films and went out and bought the novels because fantasy was suddenly in vogue thanks to the one-two punch of Harry Potter and Lord of the Rings. And now its about to happen again with The Hobbit, because Peter Jackson has proven that he can be trusted with the material. If I were Christopher Tolkien, I'd be asking for a cut of the proceeds from the films, but I'd also be very greatful for the exposure that the films have given to some of the foundational works of modern fantasy literature.
PJ is somehow turning the Hobbit into a trilogy. God only knows what he's done to it. Then again, as it's rather a travelogue of a book and the visuals were PJ's forte, and the characterisation in the Hobbit was far more shallow, I'm far less fussed over it and more looking forward to it (as long as we don't have sumo wrestling between the Necromancer and Gandalf in a ring made of moving Wargs ...)
Chris Tolkien has sued New Line for the contractually obligated cut of the LoTR film trilogy's profits already, yes.