The immediately odd thing about these toys is that they and the D&D cartoon came out very close to the same time as each other (within a few months in the same year), but featured completely different sets of characters. I vaguely recall that there was one episode of the D&D cartoon where Strongheart the paladin appeared as a sort of "guest star," but I'm pretty sure that's the only overlap - no toys were made of the characters from the show (either the heroes or the villains) and none of the other toy-characters appeared on the show.
At the time, it actually didn't seem that strange to me - after all the show was branded Dungeons & Dragons and the toys were Advanced Dungeons & Dragons, which the rule books (due, presumably, to various legal settlements with D&D co-creator Dave Arneson) were always careful to tell us were two entirely separate games (even though everyone I knew treated them interchangeably - with D&D as the "beginner's" game from which you quickly graduated up to the "real" game, AD&D). Even that distinction doesn't stand up, though, since the ostensibly-D&D cartoon featured a large number of character (ranger, acrobat, etc.) and monster types (shadow demons, bullywugs, beholders, etc.) that were only found in AD&D, and the two game products that tied-in to the AD&D toy line were both released for the D&D game (which created a bit of cognitive dissonance when, for instance, "Zarak: evil half-orc assassin" had to become "Zarak: chaotic thief" because half-orcs, assassins, and evil characters all didn't exist in the non-Advanced game at that time).
Yet another weird wrinkle to the story is that there was also a second, seemingly separate, line of AD&D-branded toys on the market at the same time - a pretty extensive line of "bendy" and PVC monsters that were at sort-of the same scale as the other toys but were much more cheaply made and had different trade dress on their packaging than the other toys. I wasn't sure at the time (and, honestly, am still not) whether these were considered to be part of the same line or not.
So what gives? Why did TSR bother creating two (three?) competing sets of licenseable IP within a few months of each other? One possible explanation is that the toys were intended for a slightly older audience than the show, but still not quite old enough for the actual game. That could be, but it seems like a weird and wasteful way to go about it (especially since TSR already had the "Endless Quest" series of choose-your-own-adventure books - featuring, of course, neither the characters from the TV show or those from the toy-line - filling that in-between niche).
What I suspect (though I've never had confirmed) is rather that this is just a tangible example of the chaos of bad management that was afflicting TSR at the time, and that almost drove them out of business in 1984 right as the game was near the height of its mainstream popularity. The D&D cartoon was produced by Dungeons & Dragons Entertainment Corp., which was Gary Gygax, operating out of his home/office mansion in Beverly Hills. I suspect the licensing deal for the toys was probably handled by a different department at TSR, in-house at the Lake Geneva office, under the direction of Brian Blume (and that Blume maybe made two separate licensing deals, one for "character" action figures and a different one for PVC and bendy monsters?).
What I suspect (though I've never had confirmed) is rather that this is just a tangible example of the chaos of bad management that was afflicting TSR at the time, and that almost drove them out of business in 1984 right as the game was near the height of its mainstream popularity. The D&D cartoon was produced by Dungeons & Dragons Entertainment Corp., which was Gary Gygax, operating out of his home/office mansion in Beverly Hills. I suspect the licensing deal for the toys was probably handled by a different department at TSR, in-house at the Lake Geneva office, under the direction of Brian Blume (and that Blume maybe made two separate licensing deals, one for "character" action figures and a different one for PVC and bendy monsters?).
Gary mentioned in later interviews that when he arrived in California he found that TSR had a bad reputation so he had to, essentially, start everything from scratch (which is one of the reasons "TSR-West" was renamed to DDEC). It's possible that perhaps a show featuring the toy characters had been pitched, but that in order to restart negotiations and get something off the ground Gary thought it best (or the other parties involved insisted) to drop that approach and start again with something fresh - making it just an accident of fate that the separately-licensed toys had already hit the shelves before the cartoon replaced them. But even that might be giving the mess of 80s-era TSR too much credit - the real story may well be that by the time the toys and TV show were being developed, Gary and Brian were on such bad terms that they didn't even bother speaking to each other about it - that neither side knew, or cared, what the other was up to.
But, whatever the explanation, the result was undeniably weird, and seemingly a perfect lesson in how not to go about expanding your IP across different platforms and media.