Here is Edwards on "internal cause is king":
Consider Character, Setting, and Situation - and now consider what happens to them, over time. In Simulationist play, cause is the key, the imagined cosmos in action. The way these elements tie together, as well as how they're Colored, are intended to produce "genre" in the general sense of the term, especially since the meaning or point is supposed to emerge without extra attention. It's a tall order: the relationship is supposed to turn out a certain way or set of ways, since what goes on "ought" to go on, based on internal logic instead of intrusive agenda. Since real people decide when to roll, as well as any number of other contextual details, they can take this spec a certain distance. However, the right sort of meaning or point then is expected to emerge from System outcomes, in application.
Clearly, System is a major design element here, as the causal anchor among the other elements. As I outlined in the previous essay, System is mainly composed of character creation, resolution, and reward mechanics.
Applying this to the authoring of a novel is strained at best. A novelist doesn't create their fiction by having other authors create and then declare actions for characters, then applying resolution mechanics to see what happens and reward mechanics to change the characters.
The only part of JRRT's authorship to which "internal cause is king" has meaningful application, at least that I can see, is his invention of imaginary languages, by applying (what he understood to be) the laws of scientific linguistics. Otherwise he seems to have made deliberate choices, either to establish the sense of place (as per the quote above from Shippey) or to convey his thematically-laden story. One thing we can be certain of is that he didn't come up with the plot of LotR by asking "What would happen if a Hobbit discovered the One Ring?" or "What would happen if a prince of Gondor had the chance to take the One Ring?" or "What would happen if the greatest Elven princess of the age met a man who seems noble though humble, and is in fact the heir, in a direct line of descent, of her uncle Elros?"
In the RPGing context, as Edward says "it is supposed to turn out a certain way or set of ways . . . based on internal logic". So we need a
magic rings and rings of power table; a
tempted by power resolution process; a
romantic encounters resolution process; etc. And these need to be calibrated based on a sense of how typical or atypical the LotR story is taken to be (ie what "set of ways" that things turn out is taken to be consistent with the "genre, in the general sense of the term").
Or we could just leave these to the GM to decide, though it can be hard to see what (eg) a dispassionate decision about Arwen's reaction to meeting Aragorn would consist in.