if i'm reading a book and there's a word in a sentence that i have no clue what so ever of what it means, then i'll look it up and try to understand the meaning of it in it's context.
Plus, looking up words you don't understand improves your vocabulary....well it does for me.
my favourite character would have to be Silk aka Prince Kheldar from David Edding's Belgariad series, and Polgara.
From Garth Nix's books my favourite character is Mogget, oh and The Disreputable (sp?) Dog.