Where's the line between genuine fusion and outright plagiarism?

Somewhere else than the AO3 Abuse Team estimates it to be, says my gut feeling.

Anyway, judge for yourselves:

The Hobbit/Vorkosigan Saga fusion. The work the fusion is supposedly based on.

No, it's not the same, word for word (although there are identical passages). But it's the same plot, and I don't mean the sweeping, general one. I mean step. For. Step.

I've read "Shards of Honor" more times than I can count; it was the only thing I had to read during an otherwise boring three-week-long vacation with people I had nothing in common with.

Is it a work of fusion when I can foretell the next action by any of the named characters in the fusion work? Because it's. Exactly. The. Same. As. In. The. Original?