There are stories that can be richer as a result of easier characterization. If a character adopts the name "King Arthur" as an alias, that immediately tells y

There are stories that can be richer as a result of easier characterization. If a character adopts the name "King Arthur" as an alias, that immediately tells you something about the character, because King Arthur is a well-established character with well-established traits. We do not need to say that the character is lawful or just, because that is implied by the similarity to King Arthur. Similarly, I might want a character to take the name "Frodo Baggins", to imply loyalty and perseverance. However, use of that name, part of general culture for the past 77 years, would be copyright infringement.