New LOTR games coming down the Shire

So how, exactly, can they do a sequel to the rather good Battle for Middle Earth? I mean they've

done the story. This means EA have to either A) do what they did with Third Age and make a side story, which in the case of Third Age, was rubbish. Or B) Redo the story again, only more shiny. There's some explanation about new races and all that, so it sounds like they may be going for option A. On top of the sequel to Battle for Middle Earth, there is also a PSP game in the works called Lord of the Rings Tactics.

What's interesting is both titles say about using locations from the movies AND the books. Why is that, when Vivendi Universal, via Sierra, have the rights to the books?

Very simple. They don't anymore.