Actually, there is a difference between 'public domain' and free use. If there are restrictions, then the copyright holder still possesses the copyright to put those restrictions on use, so they wouldn't be in the Public Domain.
Public Domain is a legal state of being, kinda. IF no one owns something, it resides in the public domain, i.e. anyone can use it. You can adapt it, pick it apart, whatever. In terms of copyright a work becomes public domain X number of years after the death of the author. Many authors sold their work outright to companies that dissolved without passing those rights on, so they end up in the public domain as well. Some notable Pin-Up art ended up that way in the 1920's and 1930's.
This is why you have adaptations of Grimm's Fairy tales and Shakespearian plays. A lot of the greatest artworks ever are in the public domain.
That said, the reason I have to say 'X years' is that Disney and the other big names in the entertainment industry are pressuring the US congress to extend copyright further and further. Soon, nothing will pass into the public domain. This would be tragic, imho, though others here differ.
So if something is truly in the public domain, you can do whatever you want with it. Verifying whether something is there, though, is very, very problematic.