Well he does, but it's the authors inventing all the little details, not him. He wrote the screenplays for the six movies, so he invented all the little droids and background things there. But for the books and such, they run it passed him for the canon changes, actually this canon guy (they interviewed him in Wired magazine a few months back, fascinating stuff) works with Lucas and all his people to figure out where he wants things to go.
The death of his characters is up to him. Chewbacca dying, that was him. Characters like Mara Jade, and Jacen Solo dying, and (God forbid) maybe Kyle Katarn down the road, that's up to the canon people and the individual authors.
For example, Timothy Zahn singularly created Grand Admiral Thrawn and destroyed him. Kevin J. Anderson created Admiral Dalaa, killed her, and then had her come back a few times before passing the reigns on to the new authors of the Legacy of the Force series to bring her back.... AGAIN.
<3 Dalaa. She's a survivor.
What I love is how the EU canon all ties together. For example, Kyle Katarn is a central figure in many videogames, but he also appears in the books too. Even Jaden Korr, your character in Jedi Academy, gets a shout out in one of the Legacy of the Force books. Really loved that.
It's all good stuff, except the new clone wars movie >.>