I am afraid it is.
The rumours explain that one of PJ's stipulations in his contract was that he would be able to keep all the costumes, props etc himself. Hence each cast member was given only one or two props to keep and hence why he is planning to set up a museum with them all in (he also he has Bag End in store at the moment
... the large one I presume!).
So the costumes were never cut up!
LOTR was the first set I collected so I actually think it's sad to cut up the costumes... mind you the Potter costumes aren't all amazing... eg Harry's tee shirt... it's not a shame that was cut up
but it would be a shame to cut up some of the beautiful dresses.
So with LOTR you have to think of them giving you an idea of the texture of the films rather than being a prop/souvenir card card
