As much as I love all things Tolkien and wait with anticipation to see "The Hobbit" done, I cannot imagine it being more than 1 film. Any more would be mere padding to draw out minor plot tangents and, frankly, would be an exercise in self-indulgence by the director (whoever directs it). One of the quibbles I had with King Kong was its seeming meandering into secondary plot lines (Jimmy anyone?) and spending much too long on action sequences. Some smart condensing of the plotlines and excising of non-essentials (as done with LOTR) would do the trick.
As for the cast, McKellan is a "MUST" and still is young enough to play the "ageless" Maia. And Weaving reprising Elrond would be great. However, as much as we all would love to see it, Ian Holm is just too old to continue his Bilbo character in this. No amount of makeup and prosthetics would be able to disguise this, especially with as much screen time as Bilbo would have. Sure, we've seen some CGI age erasures (X3 with Stewart and McKellan), but I would really hate to see that happen. All I would be thinking of is: Wow, look at that CGI. Since he is also a recent survivor of a cancer episode, who knows if he would be able to physically deal with that much commitment? As someone suggested, perhaps a flashback device to allow Holm to recreate Bilbo in the "present" and narrating his adventures.
Besides, one of the great things about LOTR was PJ's use of relatively unknown character actors to play key roles so that we didn't have many preconceptions of what to expect. This might be the best route.