With Jackson's LotR, I loved the visuals, tolerated a lot of the editing ... but couldn't stand the dumbing down. The confrontations between Gandalf and Saruman in particular were just made silly.
The Hobbit shouldn't suffer from that problem. It was always a bit of a fun children's story, I think it could turn out fine. Having seen Jackson's Balrog*, I'm looking forward to see his Smaug.
*no, that is NOT what the kids are calling it nowdays.
P.S. IM, one more blasphemy from you and you're getting the dunking stool, capice?