If a song is not copywritten, it is public domain. A band/singer/etc. can play it, modify it, slaughter it, sample it, use it on their answering machine and there is NOTHING illegal about it.
Once a copywrite is on a song, then those people that have ownership of the copywrite must give permission for the song to be covered, published, etc. Basically, if its copywritten - its illegal to use it without permission. However, someone can stand up on stage and sing a copywritten song, and if no one knows the difference - oh well. It takes a lawsuit to actually enforce (like the Stones suing Verve for 'borrowing' the lick in Bittersweet Synphony).
Pink Floyd had to come to terms with Roger Waters to continue to perform classic Pink Floyd tunes...that's usually what happens when a band wants to continue to play songs that have copywrites.
Every situation is unique. But here's the real killer. If that guy goes and gets the copywrite on the music before you or anyone else - you are screwed. Then he retains the copywrite and its almost impossible to reverse that. Then, even though you wrote the music, he gets the credit, and the right to make money from it without having to give you a dime.