Or if they have a trademark then can we still use it as a .com version?
Without their consent, you cannot use their branding or you can be sent a legal takedown for your site.
But answering the OP question, you can perfectly own a trademarked domain, but then you cannot use the trademark as part of your content (without consent). So basically, as I said most people just used such domain for CPA offers landing pages (like the parked pages for sale), not for a fully featured content site (unless you are willing to rebrand your site, disregrading your domain name).
So, following the author's example, if you have the domain WutangClan.co you can perfectly use it for a site called "Wukong Clan" if you want (logo with Wukong, titles with Wukong, etc... but never mention Wu-Tang Clan words in the site). And they can't do absolutely nothing for owning wutangclan.co domain for your wukong clan site.
Also, you can technically use Wu-Tang Clan if it pleases you, and suggest that you are a "unofficial fanpage site". Many sites used to do this and obviously drove a lot of visits, and the official site was happy with this to some extent because it was a way of side-promotion (someone else generating content for their brand). But they can stomp on your content at some point if they don't like it (for example, if you publish their whole songs in your site for free, through your own media players).
Basically, most of the advice is common sense from a legal standpoint.
