Yes, it is indeed prevalent, but that is because of its fame. I think that if it wasn't quite so famous, it would not be nearly as sucessful. People most likely made movies out of them because people will recognise the connection, and thus make even more money for the film producer.
As for making up words, Dr. Seuss made up words, I can make up words, everyone can make up words, if those words were published to the extent that shakespeare's words were published, they would most likely be used as well.
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