The dumbest 'moment', in my mind, is that he fucked up the entire Hobbit story. The Hobbit is different from the LOTR trilogy in that it is more of a self contained and awesome adventure story than an epic saga.
In the book, it's simply an awesome self contained adventure story up until Smaug is killed (with subtle references to heavy shit that will become more relevant later in the series, i.e. finding the ring, etc).
And THAT was what I looked forward to watching when I learned that the book was going to become a series of films. I was actually kind of pumped to learn it was going to be a trilogy because I thought 'this will give them plenty of time to cover the entire book'....how wrong I was.
It became apparent from the beginning of the first movie that there wasn't going to be much effort to telling the actual story of The Hobbit. The movies are essentially comprised of characters that never existed in the book, chase scenes and battles that never happened, endless strings of manufactured connectors to the LOTR, occasional nods to tales from the Silmarillion and none of it worked for me.
In a perfect world it would have been 2 movies; (1) the beginning of the story up until they go into Smaug's lair and (2) Smaug's fight/death and the following events to the end of the book.
My nephew saw it seemed to dig and so did his friends...also, the films seem to be making good enough money so I guess: mission accomplished?
It's a goddamn shame because this was one of my favorite books as a kid and something I read every 5+ years for the nostalgia effect. Can't forget hiding under a comforter in my room and using a dim flashlight to sneak in a few more chapters after bed time.
Thanks for crushing my childhood, Peter Jackson.
EDIT: b/w I refuse to actually pay to watch the third installment. I will steal that without regret or guilty conscious. Fuck that monstrosity. And, it's so far down on my list of things to watch that I don't know when I'll actually watch it.