Actually, knowledge of fantasy literature has tended to be low among those on whose shelves I have found Tolkien.
TlotR has been well represented, though, in households with a more general interest in 20th-century literature. Other works of fantasy one might find in such libraries include T.H. White's The Once and Future King; C.S. Lewis's Till We Have Faces and Space Trilogy; Ursula K. Le Guin's Earthsea books; Walter Wangerin, Jr.'s The Book of the Dun Cow; and Richard Adams's Watership Down and Shardik.
Growing up among people who are "bookish" in that sense may make exposure to some works more likely; one may well have been read to from The Hobbit, or received it as a gift, as a child. On the other hand, such folks seem less often (my maternal grandfather, with his collection of Ace Double Novels, being an exception) to be great fans of fantasy and science-fiction. Their light reading, from what I have seen, tends more to historical romances, mysteries and espionage thrillers.
The needs of film, television, comic books, computer games, and toys are, I think, more often in harmony with those of a D&D game than are those of literature. They have taken over the role in popular culture that "pulp magazines" and radio played in a former era (one waning even when Gary Gygax was a little boy).
The cartoon series "Thundarr the Barbarian", for instance, seems an excellent match. I would not be surprised to learn that many adventure serials have not only influenced D&D players but been partly shaped by them.
The basic ethos has not changed much, I think. Weird Tales was aimed primarily at an older audience, so it does not seem apt to compare its "spicy" or "dark" aspects with the tenor of works meant mainly for children. Beyond that age group, sex and violence are now commonly treated in ways that make (for instance) Howard's tales of Conan seem comparatively tame.
One could make too much of superficials. When TSR reached a wider audience with the Basic and Advanced D&D products, it settled on a baseline set of elements to define the game's identity -- what has since come to be taken as a genre of "D&D fantasy" (or even, to some folks, "standard" fantasy).
That presentation started to expand in the 2E era, and WotC continued the process. It has been IMO a matter less of truly broadening horizons than of shifting emphases, although the former aspect may be considerable for those to whom D&D is essentially self-contained and self-referential.
Among the fellows with whom I am currently playing, one has read Leiber's tales of Fafhrd and the Gray Mouser and has at least heard of Moorcock's Elric. That Jack Vance, Leigh Brackett, Andre Norton, Manly Wade Wellman, Clark Ashton Smith, Abe Merritt, and most others whom Gygax cited as influences are if not unknown then unread does not surprise me. DMG Appendix N was probably what first brought them to the attention of most D&Ders -- and most among them probably did not go in search of the books.
The one big surprise to me was lack of acquaintance with Conan the Cimmerian in any form (even, I think, the movies). The Marvel Comics version especially (both the color comics and the Savage Sword of Conan magazine) had seemed to me ubiquitous, and these fellows are all of similar age.
