The Lord of the Rings franchise is an ancient one: several movies and TV shows have come out before Peter Jackson came forward and gave it the cinematic grandeur it deserves. Tolkien's universe is packed with several characters, each of them unique in their own ways, several of them belonging to entirely different species even.
The story borrows its heart from medieval folktales, in which good and evil are clearly defined, and good always triumphs in the end (after being victorious over evil. Nevertheless, there are a few characters whose moral directions are not clearly defined — a few villains display heroism while some heroes perform acts of utmost shadiness.
Acts Like A Villain - Bilbo Baggins
Bilbo is the star of The Hobbit, and plays a significant role in the later trilogy — by bringing the One Ring out from the darkness of Gollum's cave. However, the Ring has corrupted him, as seen when he lunges at Frodo with a demonic expression on his face.
Actually, it can be argued that Bilbo is never entirely good: while playing Gollum's challenge, he asks "What have I got in my pockets?", a clear violation of the riddle game's rules. To be fair, Gollum also cheats by giving two answers in one go, "String... or nothing!"
Is Actually A Hero - Boromir
Boromir only wants to see the Kingdom of Gondor prosper, or so he would have it be known. In truth, he is a Daddy's Boy, playing along with Denethor's ignorant and callous whimsy. Although he tries to fulfill his father's wishes and forcefully takes the ring from Frodo, the latter manages to escape his greedy clutches.
When the Fellowship is later attacked by a bunch of orcs, Boromir fights valiantly to save Frodo and the other hobbits, but is martyred in the process. Through this act, he has obtained redemption for his earlier sin.
Acts Like A Villain - Theoden
Before his release from Saruman, Theoden was a classic example of a mad king. His adviser, Wormtongue, had been tainting his thoughts with hatred and revenge for several years. It reached a point where Theoden even rejected his own nephew because Wormtongue claimed that Eomer is secretly plotting to kill him and take control of Rohan.
The king scorns Gandalf's statements, saying that he is not under anyone's control but his own. Thankfully, the White Wizard is now strong enough to oust Saruman from Theoden's mind.
Is Actually A Hero - Isildur
The future generations of Middle-Earth despise Isildur for his role — or rather, the inability to complete his final task by destroying the One Ring. People far greater have fallen under the spell of Sauron, so it's not surprising that the greed for power overtook him as well.
What actually matters, however, is the fact that it was Isildur who led the first charge against Sauron's armies, it was he who faced the Dark Lord in singe combat, and it was he who, at the end, cut the ring off his adversary's finger and brought peace to Middle-Earth.
Acts Like A Villain - Galadriel
Galadriel has only recently (in the past thousand years or so) become the kindly Lady of Lorien. For most of her long, long life, she has acted in ways that would put the orcs to shame. When she was young, her cousin, Feanor, asked her for a strand of her hair, unmatched in all of Arda in its lustrous beauty.
Galadriel merely scoffs at his request and sends him on his way (indirectly causing the first major conflict in Arda.) Her innate ambitions come temporarily to the forefront when faced with the possibility of obtaining the One Ring, as we see in the drastic change in her appearance and voice. However, she remembers her place, and allows Frodo to go forth from her land.
Is Actually A Hero - Shelob
Shelob is the unwitting guardian of Sauron's back door. The stairs of Cirith Ungol have no orcs manning it, because the monstrous spider is always on call for anyone who thinks they've outsmarted Sauron. Her subtext is not meant to offer any reasoning for her behavior, except that she is born of the darkness, like her mother, Ungoliant, and her personality is intended to reflect her birth.
Shelob might be a vile creature, but she only attacks Frodo and Sam out of hunger, not malice, considering her last meal was weeks ago. Fighting for one's food, especially against opponents with dangerous weapons, is a sign of courage, not cowardice.
Acts Like A Villain - Meriadoc Brandybuck
Merry is not as innocent as his jovial attitude and funny pranks might make it seem. Aside from causing continual havoc in the Shire with his partner in crime, Pippin, he displays hints of self-centered behavior on occasion.
For instance, it is revealed that Merry is fully aware that Bilbo had the One Ring, given that he sees the old hobbit simply disappear after putting it on. Armed with this knowledge, he could have told someone, like Gandalf, for example. He keeps it to himself, postponing the day of reckoning but causing a massive waste of time and innocent lives.
Is Actually A Hero - Sauron
Sauron was not always a tyrannical monster. In fact, he was created by Ilúvatar himself amongst countless other maiar (including Gandalf and the Balrogs.) In his true form, Sauron was an elegant being of light — originally known as Mairon, a Quenya word meaning "He who is admirable".
Before Morgoth arrives and corrupts him, he appreciated the beauty in art, creating incredible works of sculpture and smithing under his master, the Vala Aule. It is foretold that after the Final War, Sauron will rejoin the world under God, cleansed of his past evil.
Acts Like A Villain - Frodo Baggins
Frodo's descent into greed is not a pretty sight, least of all for Sam. He lashes out at the slightest things, which concerns his companion greatly (who offers to wear the Ring to take the burden off.)
Although the pair reach the cracks of Mount Doom, Frodo gleefully refuses to toss the soul of Sauron into the lava, claiming it for himself instead. If this had been allowed, he would have taken barely ten steps before the orcs of Barad-Dur descended upon him, charged by the rage and fury of their master.
Is Actually A Hero - Gollum
Continuing on from the previous example, the only reason Frodo is not actually a villain is because Gollum is a hero. He might be petty, vengeful, greedy, cruel, but he is, most of all, an addict — he behaves almost exactly like anyone undergoing withdrawal symptoms.
Gandalf himself explained to an angry Frodo that Gollum deserves pity, not hatred, for he was not aware of the depths he had sunk to. Further, it is he who bites the One Ring off Frodo's hand and takes it to its final fate. For this act alone, Gollum is a true hero.