What this fanfiction changes about the source text is that it combines characters from 2 completely different works and brings them together into one world. The worlds of the two works are starkly different, so the combination of the characters into one fanfiction creates an entirely new world, separate from both source texts. These characters would never actually meet in their own worlds, so this fanfiction is the fantasy of a fan that they would.
Essentially this is a remix, right? Normally, under copyright law that would be protected. Do you think this is something new or just derivative of both the works it draws from?