Going by what I’ve read in The Hobbit my impression was that Thorin Oakenshield was a nobody, the grandson heir of an extinct throne who was personally reduced to blacksmithing or even coal mining at times. Like the numerous extinct royal European lines post-World War One that Tolkien was contemporary with. His motley party’s journey was almost a farce of a royal retinue.
Yet in an online discussion someone claimed: “Thorin distinguished himself at the battle of Battle of Azanulbizar which is where he got the nickname “Oakenshield” this gigantic battle outside of the gates of Moria was known throughout the world.”
The point of contention was Thorin & Co.'s reception by Thranduil. I thought it was obvious that the Elven King (I don’t think he was even named in The Hobbit) had no idea who these scruffy vagabonds were; yet the poster I quoted seems to be under the impression that Thranduil recognized Thorin, and that his appearance immediately tipped off Thranduil that something was in the works, or why would the King Under The Mountain be returning to that part of the world?
I have next to no familiarity with Unfinished Tales so I don’t know what backstory was added there, but I’d never heard that Thorin was known and respected royalty when in exile.
Not a Tolkien scholar but I’d note that there’s are certain people who would be famous in one country and a complete unknown in another. It wouldn’t be unreasonable for Thorin to be famous among the elves and a nobody to the hobbits and humans. It just depends on what particular trivia took off among which societies and subcultures.
I sort of had the impression that Thorin was well known among the Dwarves, and thought of a something of an unfortunate. Meaning that he was known to be the heir to Erebor, valiant, etc… but due to Smaug’s taking of Erebor, he was reduced to penury and working for a living.
Outside of the Dwarves, he’s probably more like the dispossessed European nobles post WW1, in that he’s probably of some note as the heir to Erebor, kind of like say… Prince Ruprecht of Bavaria, and probably about as influential and seriously considered as he was in the 1930s-1950s.
Remember that, in pre-modern times, “famous” does not necessarily mean “recognizable”. Pictures of people only existed when someone took the trouble to paint one, and spreading someone’s picture far and wide required many paintings. So Thranduil probably did know that the king-in-exile of Lonely Mountain was named “Thorin”, but he had no way of knowing that the scruffy dwarf who barged in on his picnic was Thorin. At most, he might have born a family resemblance to his grandfather (who Thranduil probably would have met multiple times, since there was peace and trade between their nations), but that depends on how well an elf can distinguish family likenesses in dwarves, and might not mean anything anyway (since there would be plenty of other members of that family of much lower status).