Remixes in fan games?

[Souperion]

I apologize if this thread is ending up in the wrong place, but I wasn't sure where else it would fit.

So, a question: is it a legal offense or infringement to use a remix of a video game song in a fan game? I ask because I have this little nowhere YouTube channel for mixes I collaborate on, and someone asked if they could use one of our arrangements in a fan game they are creating. Last I knew, remixes that are not being used commercially are no big deal, but as much as I am flattered by the offer, I am hesitant.

So far, all I know is that the individual asking for permission seems to be making a fan game of Freedom Planet (an indie platformer reminiscent of Sonic the Hedgehog, made by Galaxy Trail). Our arrangement is a medley of a song from Freedom Planet and a piece from Sonic Colors. We're waiting for more information from the person. I enjoy the remix, but personally don't really think it is worth putting in a game. More importantly, I'm worried about the ramifications, since fan games seem to be a complicated matter. What should I know about fan games and supplying remixed music to them? 

Again, sorry if this thread is misplaced. I appreciate any experienced opinions on the matter.

 

[brink-of-time]

I'm not an expert on this but I usually follow Creative Commons License when it comes to people asking to use my music (Remix or Original). 
https://en.wikipedia.org/wiki/Creative_Commons_license

Now if you create your music with no intent for profit, the user of your remix needs to follow this as well. If they plan to use the music in a game meant for profit, it goes against what your license originally intended when you first wrote the piece. This gets even more complex if the company/composer who owns the original rights, allows remixes as long as no profit is made whatsoever unless directly licensed. 

In short, you release for free, they must also release their game for free if they use your remix, unless they get explicit permission from the original rights holder (ie: Original company/Composer), then from you.
If you release it for legal profit, again they must first get permission from the original rights holder, then from you. 

It's all about whether they want to make money.

 

[Souperion]

I appreciate that information. We suspected that making sure there is no intended profit was key to keeping things peaceful, but were unsure if there were other particulars.