Thanks for the comments, everyone! Sometimes you wonder if you're just talking into cyberspace... I'm glad to hear that people are interested in reading a C&C blog like this one.
There's good news out there - the Trolls have signed some sort of agreement with Goodman Games, allowing Goodman to publish C&C material. It's probably a dual-statted product, or a pdf conversion of an older Goodman product. We won't know for sure until the official announcement.
This brings us to an interesting question. Troll Lords have stated that they aren't interested in working with many other publishers - GG is one of the ones they like. How permissive should TLG be in allowing other people to publish C&C material?
Basically, the entire C&C game mechanism is Open Game Content; you couldn't reprint the actual book (because lots of flavor text is not OGC), but you can write and publish anything you want using the rules. TLG's control over the material lies in the fact that you can't SAY that it's for Castles & Crusades without their permission. Any mention of compatibility with C&C in a third party product is illegal without permission. The result? TLG has complete control over any commercial publication using C&C rules - if you can't say it's for C&C, you can't connect with potential buyers.
This is why Goodman Games needs to sign an agreement with TLG. TLG could demand whatever it wants from another publisher - a share of profits, a flat fee, or nothing at all.
In my mind, it is to TLG's benefit to require nothing at all - at least for the forseeable future (and making sure not to grant blanket rights - don't say that a particular publisher has the right to say that products are for C&C, just that they can do it for particular, named products).
The Castles & Crusades game will grow more quickly the more products (especially free ones) are out in the market. The more the game grows, the more products TLG will sell, in the long term.
We'll never see the details of the Goodman/TLG agreement - terms will stay confidential. If it were me, I'd have given Goodman the right to use the C&C name on conversions of all GG's existing d20 modules (listed by name). In return, I'd have asked something like the following: (1) they must be converted and posted as pdf by a certain date. (2) Goodman must advertise these products in places like ENworld or Dragon Magazine (with content approval by TLG), spending a particuar amount of money on the ads. (3) Goodman must prepare a NEW dual-statted module for d20/C&C, or for C&C alone, with guidelines on how it's promoted.
This is a win/win for both companies: Goodman gets to sell converted modules at no licensing cost, except a dollar commitment to advertise its own product. TLG gets a free ride on the advertising, and can point new players to a raft of ready-made modules for C&C.
Of course, depending on TLG's cash flow situation, it might be more important to bring in some cash up front, since TLG needs to make sure that it's able to print enough copies of the core books to ride this wave - that takes money. Goodman might be willing to pay some cash up front (or a share of revenue) in order to avoid promising exact advertising dollars.
Whatever the exact terms of the agreement, it is positive for C&C that the capital costs required to hit this market with lots of support product is being divided up among more than one company. The more support product, the better the game will ultimately sell. Let's see more such deals!
(Time to get Necromancer Games on the phone...)