This argument doesn't undermine property protection in general and is fully compatible with strong physical property rights (which I advocate).
I'm not particularly interested in convincing anyone, just to share a perspective that others might find useful in their own thought process, so here it goes...
The problem of the derivative nature of IP protection is that much of the discussion of IP rights revolves around the full ownership of what's being protected. I say that you can't copy this book, or translate it to Braille because I own it. What I'm arguing is that when someone claims there is a body of thoughts to be protected, they are actually arguing for the protection of a really small percentage of it - because the rest isn't really theirs, it was not transferred to them willingly and is just being freely acquired with no consultation of the original owners of the derivative portion. You wrote this book, but most of it actually came from somewhere else.
So they are then charging for this "delta" which they "added" and trying to negotiate a market price for it. Well, if we were to allow that, we should also allow all derivative work and let the market judge the value of the "delta". For instance, can I now create a "Revengers" group of Superheroes that are just like the Avengers, but with tweaked uniforms? (Hint: NO) Then the public can judge whether my uniforms are better and pay me accordingly.
But then a judge will say that my addition isn't "enough" or "substantial". Very subjective, isn't it? Law is subjective and we built a useful legal system around it, so it's ok to say that these compromises are needed for society to work. But having to compromise to create A system doesn't mean that the compromise is the right one.
There is an illusion that we can clearly identify the origin of all protected original, derivative elements in a work of art, point to their owners and compensate them. And we think that we are actually compensating these people. We are not.
There is a large body of precedent and very subjective opinions about all of this. But strong, long IP protection proponents are claiming higher moral ground on these fairly weak subjective options. So sure, say that it's ILLEGAL to copy stuff, but don't come and say that it's IMMORAL to break such laws as they are written and that breaking these laws equate to communism.
So about tangible property... Let's set aside whether I can create a copy of tangible property (this is IP rights again) and just focus on the ownership itself.
When you buy a lawnmower, there is a very clear, and easy to track chain of ownership of all the components of this lawnmower. The blade was purchased from X, who bought the metal from Y, who paid Z to mine it. The screws, case, box. The property rights of everything in the lawnmower, save the IP, are fully respected due to the clarity of origin of all components that make it. So it's not possible, as I can do with IP, to claim that it's hard to identify the ownership of all parts or that we are applying different standards to the compensation of the owners of these parts.
I think you can see how that affects the inheriting property example. All voluntary, all parts and origins clearly identifiable. When you inherit land/house, someone who fully owns was ok with that (otherwise, at least in the US, they would have written a will to the contrary).
We have a great system to tracing physical property, and its parts, to their owners and compensating them. Same doesn't exist (and CAN'T exist) for IP. Because, duh, IP and physical property aren't the same thing and we should stop trying to put them in the same bag to begin with ("copying a movie is like stealing from the store" as some say)