I don't think derivative works should be protected personally. Is the world really better off with only George Lucas being able to make Star Wars movies? The fans would say no, I imagine.
Creators should be protected from pirates. Movies require a ton of money to make, and copyright protects their investment. And gives an economic incentive to create new works. Protecting derivative works doesn't really increase incentives for new works much. But it heavily restricts what others can create on it.
That said, it would be trademarkable. So you wouldn't be able to call it "Star Wars", or advertise it as canon. Or put the famous logo on it.
I read once that ancient Greek plays had lots of crossover and common characters that everyone knew. I think an alternative world without derivative work protection would be pretty interesting. Some of the best works I've ever read were fan fiction. They are technically illegal, and can never be put to print.