The Osanwe-kenta is written as an in-universe document describing the abilities of mostly Elves, but also everyone in LotR using "though-transmission" and other such abilities. Key here being everyone, including men:
It's a simple operation at its very basics. First you must be able to perceive the person, which is not an easy task. The sender must have full intention to either communicate or 'inspect' the receiver, and the receiver must be 'open' to this for it to work. They can be open to just the one sender, or open to more than one. However, only great minds can converse with more than one at a time, usually restricted to powerful beings such as the Valar. As well, the receiver can also use the resulting connection to gain information from the sender's mind, even if the sender doesn't intend it. If you are not open, then tough luck:'Men have the same faculty as the Quendi, but it is itself weaker, and is weaker in operation owing to the strength of the [body], over which most men have small control by the will.'
I can already sense some objection, but we'll cover that in a minute. Distance is not a factor in this case, however the fact that the "spirit" is encased in a "body" acts as a barrier to easy and clear telepathy for Elves and other physical beings, restricting the person in who they can talk to or read. You can, of course, strengthen your ability to communicate with another by three methods: Affinity, Urgency, or Authority.Though in "Arda Unmarred" openness is the normal state, every mind has, from its first making as an individual, the right to close; and it has absolute power to make this effective by will. Nothing can penetrate the barrier of Unwill.
As noted, despite differences in strength and capacity, all minds are considered to be of equal status, and the barrier of Unwill cannot be penetrated. Which would seem to contradict some events which did take place during the books. First and more important to point out is that the god Eru is allowed to break this barrier any time he wants, since he is the creator of Everything. Secondly, there are ways around the barrier, as Melkor discovered:'Affinity may be due to kinship; for this may increase the likeness of [body] to [body], and so of the concerns and modes of thought of the indwelling [spirits], kinship is also normally accompanies by love and sympathy. Affinity may come simply from love and friendship, which is likeness or affinity of [spirit] to [spirit].
Urgency is imparted by great need of the "sender" (as in joy, grief or fear); and if these things are in any degree shared by the "receiver" the thought is clearer received. Authority may also lend force to the thought of one who has a duty towards another, or of any rule who has a right to issue commands or to seek the truth for the good of others.'
The effort then was the come up with a way to circumvent this barrier. For Melkor, one of these methods meant taking advantage of the new invention "language". Through language he could lie, cohort, and intimidate, as well as simply torture, the information he wanted out of someone. Unfortunately lying was a double-edged sword.'Here he was aided by the simplicity of of those unaware of evil, or not yet accustomed to beware of it. And for that reason it was said above that the distinction of openness and active will to entertain was of great importance. For he would come by stealth to a mind open and unwary, hoping to learn some part of its thought before it closed, and still more to implant in its own though, to deceive it and win it to his friendship. His thought was ever the same, though varied to suit each case (so far as he understood it): he was above all benevolent; he was rich and could give any gift that they desired to his friends; he had a special love for the one that he addressed; but he must be trusted.
In this way he won entry into many minds, removing their unwill, and unlocking the door by the only key, though his key was counterfeit. Yet this was not what he most desired, the conquest of the recalcitrant, the enslavement of his enemies. Those who listened and did not close the door were too often already inclined to his friendship; some (according to their measure) had already entered on paths like his own, and listened because they hoped to learn and receive from him things that would further their own purposes. (So it was with those of the Maiar who first and earliest fell under his domination. They were already rebels, but lacking Melkor's power and ruthless will they admired him, and sway in his leadership hope of effective rebellion.) But those who were simple and and uncorrupted in "heart" were at once aware of his entry, and if they listened to the warning of their hearts, ceased to listen, ejected him, and closed the door. It was such as these that Melkor most desired to overcome: his enemies, for to him all were enemies who resisted him in the least thing or claimed anything whatsoever as their own and not his.'
It's the consummate liar who suspects everyone else must be lying too.'Thus by deceit, by lies, by torment of the body and the spirit, by threat of torment to others well loved, or by sheer terror of his presence, Melkor ever sought to force the Incarnate that fell into his power, or came within his reach, to speak and to tell him all that he would know. But his own Lie begot an endless progeny of lies.
By this means he has destroyed many, he has caused treacheries untold, and he has gained knowledge of secrets to his great advantage and the undoing of his enemies. But this is not the same as entering the mind, or by reading it as it is, in its despite. Nay, for great though the knowledge that he gained, behind the words (even those in fear and torment) dwells ever the [mind] inviolable: the words are not in it, though they may proceed from it...they must be judged and assessed for what truth may be in them.'
Which obviously leaves the question of how to reconcile this with what Sauron did, which the essay does not cover. However, the differences between what Sauron did and what Melkor did are not all that different upon reflection. Sauron was able to subvert the wills of others only so long as they agreed to wear the Rings. The Kings of Men, unaware of the danger, gladly accepted them and used them greatly, in a sense being "open" to the Rings, which were connected to Sauron. By this means he was able to torment them mentally until, depending on the strength of will and character of each, they all succumbed to him. However, the Elves, being better than Men at these things, immediately perceived just exactly what Sauron was going to do when he put on the One Ring, and took theirs off. The Dwarves, having been designed specifically to resist the will of others, were also immune to this mental takeover, though the connection still served to bring out the worst in their character and resulted in a lot of Dwarves getting gulped down by dragons. It explains why, despite his obvious fortitude in mentally directing vast armies of Orcs and other beasts, he couldn't simply dominate an enemy's mind and had to resort to such backdoor "hacks." It also explains why people are sometimes able to "perceive" each other in the books, such as when Frodo feels the "cold chill" of the Ringwraiths or the pure dread of being near Shelob, without being able to actually see them, or when he's received a vision from Galadriel despite being thousands of miles away from each other.
Obviously some people might not agree to this interpretation, since the essay was not one of Tolkien's published works while he was alive, but it seems to give a pretty clear indication of what his last documented thoughts on the matter were.