Hobbiton would be a huge challenge due to difficulties in maintaining sight lines, as well just being a rather benign setting with scarce potential for attractions. Personally, I think LOTR at any theme park is a long shot, but if a location from the films were to be built, it would have to be Lothlorien (Land of the Elves). Universal has yet to build a land that is predicated on 'oneness with nature' ala Pandora, and this could be their answer. It would also open the door to a boat ride attraction, which seems like the most natural fit for this particular IP.