Can invention be denied a patent because of obviousness in the light of existing patent and at the same time be free to practice by anybody?

I am considering applying for a patent with some similarities to my previous existing one (awarded). It covers different application and leverages different features but has similar structure. What happens if I my application is rejected because of obviousness in the light of previous patent combined with prior art. Would it mean that the new invention is protected by an old patent, along the same logic as the rejection itself? Could I then use the Patent Office rejection in later ligitagion to prove that my older patent covers the other field as well? Or, contrary, it is possible that I cannot get a new patent because it is too similar (when combined with prior art) and at the same time a third party can practice the new invention because it is not literarly covered by the claims. Intuitively, this should not be possible, otherwise one is locked out of patenting genuine invention.