I don't think anyone is really looking for a strong recommendation for the Hobbit -- by now its reputation should be enough to sway you one way or the other -- I really just wanted to say a couple things.

A) This edition of the book was nice: easy to hold while reading it to my son in bed and with some extra illustrations and pre/post text.

B) Reading this aloud gave me a new appreciation for the craftsmanship that Mr Tolkien employed. I've read this through three or four times in the past, but really only considered it a fun lead-in to the 'real story' in Lord of the Rings.
Something in hearing the words, in letting the alliterations and flowering landscapes and song poems and riddle sharing come off your own tongue, you really get a true taste of the author's intentions.

I should also add that my seven year old seemed to enjoy it, though a few of the less action-centric, backstory sections probably went over his head. All the same, when we had finished he was curious to hear what comes next, though I'm not sure I'm up to reading all of the LotR series just yet.