The origin of birds and avian flight from within the archosaurian radiation has been among the most contentious issues in paleobiology. Although there is general agreement that birds are related to theropod dinosaurs at some level, debate centers on whether birds are derived directly from highly derived theropods, the current dogma, or from an earlier common ancestor lacking suites of derived anatomical characters. Recent discoveries from the Early Cretaceous of China have highlighted the debate, with claims of the discovery of all stages of feather evolution and ancestral birds (theropod dinosaurs), although the deposits are at least 25 million years younger than those containing the earliest known bird Archaeopteryx. In the first part of the study we examine the fossil evidence relating to alleged feather progenitors, commonly referred to as protofeathers, in these putative ancestors of birds. Our findings show no evidence for the existence of protofeathers and consequently no evidence in support of the follicular theory of the morphogenesis of the feather. Rather, based on histological studies of the integument of modern reptiles, which show complex patterns of the collagen fibers of the dermis, we conclude that protofeathers are probably the remains of collagenous fiber meshworks that reinforced the dinosaur integument. These meshworks of the skin frequently formed aberrant patterns resembling feathers as a consequence of decomposition. Our findings also draw support from new paleontological evidence. We describe integumental structures, very similar to protofeathers, preserved within the rib area of a Psittacosaurus specimen from Nanjing, China, an ornithopod dinosaur unconnected with the ancestry of birds. These integumental structures show a strong resemblance to the collagenous fiber systems in the dermis of many animals. We also report the presence of scales in the forearm of the theropod ornithomimid (bird mimic) dinosaur, Pelecanimimus, from Spain. In the second part of the study we examine evidence relating to the most critical character thought to link birds to derived theropods, a tridactyl hand composed of digits 1-2-3. We maintain the evidence supports interpretation of bird wing digit identity as 2,3,4, which appears different from that in theropod dinosaurs. The phylogenetic significance of Chinese microraptors is also discussed, with respect to bird origins and flight origins. We suggest that a possible solution to the disparate data is that Aves plus bird-like maniraptoran theropods (e.g., microraptors and others) may be a separate clade, distinctive from the main lineage of Theropoda, a remnant of the early avian radiation, exhibiting all stages of flight and flightlessness.