One of the other issues is that you might not be treading on copyright, but trademarks. I know a few companies have trademarked images as well as holding the copyright in them, and trademarks are much more vigorously protected.
The fact of the matter is this. If someone makes something that is sufficiently creative to warrant legal protection, they are entitled to do what they want with it and prevent others from doing something they don't want them to do with it. If you were the one to originally create a piece, you would want that protection so that bigger companies wouldn't come and copy it and you get nothing. It is to protect the artist's work and allow them to actually make a buck off it. Yes, it has gotten complicated, but the original basis is still really valid, almost especially so since its so easy to copy things now.
Now, are the people on Etsy being a bit crazy about it? Possibly. But they are also looking out for you whether you feel they are or not. One single infringement of copyright can cost $150,000 in statutory damages, and that's not the maximum and doesn't include what you might have to pay in lawyers fees! By bringing it to your attention, you can choose what you do in an informed way.
The fan art/real art debate is silly. Most things are inspired by something else. The trick is that in order to really consider it your own, it needs to be different enough that it is clear that it is not copying something- just inspired by it. For instance, these
Disney gender-bent images are clearly inspired by their Disney counterparts, but I doubt that anyone would claim they were copies or not real art. But they clearly express an originality, creativity, and talent of the artist who made them.
And don't confuse creativity with effort. Just because I've slaved away on a cross stitch for 9 months does not mean I've managed to get any protection for it. We can spend hours of work on something, but it still might not have any protection unless you've managed to put your creative stamp on it.
Its all about having your own artistic voice. This means that if you want others to recognise your work as more than a copy that you need to express your own artistic voice in your work. If others can't see your own voice in something, I find that's when people start calling it into question.