[Gordis]

Originally Posted by BGreg

That is possible. However, you're not mentioning the fact Legolas was also pretty scared when Balrog appeared, was he not?

As for the Balrog, there was indeed a very good reason to be scared. But for Ganalf, the balrog would have killed them all in no time. Legolas explained his fear to Celeborn

:"It was a Balrog of Morgoth,' said Legolas; `of all elf-banes the most deadly, save the One who sits in the Dark Tower."

Legolas was no Calaquende Elf to have great power in the Unseen. (I don't believe there is enough evidence that Legolas lived in the First Age - in LOTR he is written as a relatively young elf). But still he didn't fear the ghosts of Men:

there was not a heart among them that did not quail, unless it were the heart of Legolas of the Elves, for whom the ghosts of Men have no terror. - "The Passing of the Grey company."

Originally Posted by BGreg

And I don't think the Men behaved much different then Gimli did. Yes, they have seen the shadows (or maybe just perceived them), but were no less frightened.

The interesting thing is that Men were far less frightened of the Balrog that Legolas or Gimli were. Aragorn and Boromir firmly held their ground, clenching their weapons. Boromir blew his horn and was the last to retreat. Even the hobbits felt more or less OK. Legolas and Gimli, in contrast, were incapacitated by fear.
As for the Paths of the Dead, Gimli felt far worse fear than the Dunedain rangers:

Then Aragorn led the way, and such was the strength of his will in that hour that all the Dúnedain and their horses followed him. [...] Legolas passed in. And there stood Gimli the Dwarf left all alone.
His knees shook, and he was wroth with himself. ‘Here is a thing unheard of!’ he said. ‘An Elf will go underground and a Dwarf dare not!’ With that he plunged in. But it seemed to him that he dragged his feet like lead over the threshold; and at once a blindness came upon him, even upon Gimli Glóin’s son who had walked unafraid in many deep places of the world.

Originally Posted by BGreg

So the rings had no power over them. Isn't Tom Bombadil described in the same manner in the Elrond's Council? That makes me wonder. What would happen if a dwarf had found The Ring? Would he become invisible? Apparently not, if the quote above is to be trusted. How then did the dwarves not see a person wearing The Ring, like Bilbo? Would they not have the same power Tom Bombadil had?

The rings did have power over the Dwarves - the dwarves couldn't turn invisible, yes, but they used the rings to gain wealth. Mad dying Thrain found in the pits of Dol-Guldur had forgotten his name, his people, everything but his Ring - that implies that the Ring had a very strong hold on his mind.

Tom, on the other hand, was not affected by the Ring at all. Still when Frodo put on the Ring in Tom's house, Tom was able to see him quite clearly - to see him in the Spirit World and that without wearing the ring or turning invisible himself. Thus Tom probably lived in both words, like Calaquendi elves.

The Dwarves were unable to see Bilbo wearing the Ring, as you have mentioned. Unlike Tom, they had no access into the Spirit world.