Yeah, it's a prequel focusing on Bilbo Baggins, 12 dwarves trying to retake their home from a dragon, and Gandalf. Sauron probably won't be in it, though. I think he was vaguely mentioned in the book at one point, but didn't actually appear.
That's a real shame. New Zealand has some beautiful landscapes. Filming there added a strong feeling of authenticity to the film as a whole. I was hoping to see some of the landscapes return in The Hobbit, particularly since LOTR has Frodo and his friends partially following the footsteps of Bilbo's earlier adventure.
Well, it seems like things are finally moving forward. I'm glad Jackson is directing it; that should help ensure it fits more tightly with the universe established in the LoTR films. Now if they can just get the labor disputes solved, maybe the movie will finally get finished.