A noun by any other name

The OWL recently received an inquiry about what to call "the damned" in the following sentence:

The damned inhabit [Anne] Rice's novels.

Though "the damned" functions as a noun, the grammatical origins of this construction are not quite as clear. The usual verb-as-noun explanation, the gerund (or "-ing" form), does not apply in this instance. What, then, is the connection between this noun and the verb from which it stems?

This one is tricky, because I think it has two parts. First, "damned" is the past participle of "to damn." Usually, past participles can function as adjectives, as in "the sunken ship." But I could only find one mention of past participles functioning as nouns. AudioEnglish.net notes in very small print, "It is very rare." (http://www.audioenglish.net/dictionary/past_participle.htm)

Think about it this way. If I said, "the sunken," would you recognize the person, place, or thing that I am referring to? You might have an idea, but the picture is not complete. We do, however, understand the reference when I say "the rich" or "the young of this country." These types of constructions are called adjectival nouns or attributive nouns. With "the damned," those of us acquainted with Dante understand that "the damned" actually refers to "those who are damned," a construction similar to "the rich" (meaning "those who are rich"). In this case, I think "the damned" is a past participle acting as an adjective that in turn functions as an adjectival noun.

I would be interested to know if anyone can think of other such cases. In short, how "rare" (or endangered) is this species of noun?