This is just my theory, but I believe the little side build is supposed to be when Sam and Frodo get on the elevated rock to evade the lava after they destroy the ring and Mount Doom’s lava begins to flow.
Nice review. I just finished building my copy. The Sauron mini fig is great. I know you said he shouldn't be included cuz he's not in the movie. But I think in the books he did have a body, just did not interact with the fellowship.
Yes indeed. In the films, it's explicitly stated by Saruman that Sauron "cannot yet take physical shape", but in the books, he very much has a body. Gollum hints it by mentioning that Sauron has nine fingers, and Tolkien confirmed it in several letters, giving a description of Sauron even. "Sauron should be thought of as very terrible. The form that he took was that of a man of more than human stature, but not gigantic", and elsewhere as "an image of malice and hatred made visible".
One thing is that Sauron being in the set isn’t actually inaccurate (at least for the books) as he maintained his physical form the entire time unlike in the movies where it was just his spirit that lived on