I think you'll both be right. When POD first becoming commonplace, there was a quick surge in out-of-print books being brought back. Some was done by authors whose rights had reverted and some was done by small POD houses. I suspect e-book editions will go the same way.
Liviu_5 has it right as far as the hassle of securing e-rights, though. That's severely going to limit what major publishers do with their back catalog, whether the titles are in or out of print. If the author is still with them for current books, or if the author is with another house, but selling well, it would be worth it to them. Mid-list authors, as usual, will likely be out of luck.
That, however, opens a really nice market niche. A small specialty house, just like some POD houses do currently, can focus on bringing back out-of-print titles by appealing to authors directly.
As to free CC books, keep in mind that it's really an interim marketing method, unless an author is willing to try donationware. Right now, most free e-books are put out with the idea that it helps sell p-books, which it does. As e-books become more accepted, and more readers start choosing e- over p-, that's likely to change. Initial releases would be pay-for e-books, and older titles would be free (or maybe just cheaper).
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