"The Silmarillion" reads like ancient mythology. Though it was written by Tolkien, essentially throughout his long life, it basically is ancient mythology. Using his deep knowledge of language and lore, Tolkien created the underpinnings for his other works.
There is not much of the "psychological novel" about "The Silmarillion". It is rather a compilation of Mythical stories. It includes much of what we would expect from such a treasure store. It contains a creation myth, an explanation for the shape of the Earth, as well as the genesis of the various races that populate Tolkien's Middle-Earth.
All of this information is very convenient for anyone who wants more information about Hobbits and Elves and Orcs. We find out, for example, that Gandalf the Grey, is a Maia, roughly equivalent to an Angel in Christian belief. He was created by the Valar who were in turn created by Iluvatar, the One God.
It is interesting to note that in his work, Tolkien meticulously avoided any conflict between his myth making and the cosmology produced in the Bible. Tolkien was a Catholic, his guardian after his parents died was a Catholic Priest. His eldest son would later enter the Priesthood. In a sense, the myths laid down in "The Silmarillion" in many ways suplement the book of Genesis.
Even so, his mythical explanations must explain the existence of Sauron, Wizards, Elves and the ring. We find his universe to be highly influenced by personality. As when the Dwarves are created by Aule the Smith who is anxious to populate the world sooner than Iluvatar had planned. To do so he creates the Dwarves. Yet, he realizes without Iluvatar's creative hand, these people will be mere automatons. Thus, he goes to Iluvatar and offers to destroy the Dwarves. Iluvatar takes pity on the Dwarves and gives them a place in his scheme of the world.
At the same time very little about "The Silmarillion" defies (too drastically) the laws of Newtonian physics or at least the physics Tolkien is able to conjure in his imagination. There are, indeed, mystical forces, but these forces all operate within certain boundaries.
"The Silmarillion" is not light reading. It seems that when Tolkien created his Middle-Earth, he was able to look at it from every aspect. He wrote about it in a children's book, The Hobbit. He wrote about it in an epic novel written for adults The Lord of the Rings, and he set down its entire cosmology in "The Silmarillion.