Frodo Baggins Will Be In Peter Jackson's The Hobbit

The film adaptions of The Hobbit (The prequel book to the Lord of the Rings series) have been in development hell for years, and now it's finally being shaped into two great films. But strangely enough, Elijah Wood has been confirmed to return as Frodo in The Hobbit. The strange part is, the actual Hobbit novel takes place before Frodo wasn't even born.

We already know thus far, that Martin Freeman will be portraying Bilbo Baggins (The protagonist of The Hobbit) in the film, that Howard Shore will be scoring the film (Like he did for the last three), it will be shot in 3D, and will be split into two separate parts. Now for those of you fans out there who are worried about Peter Jackson messing up the brilliant story of J.R.R. Tolkien’s classic novel, don't be alarmed. It turns out Frodo won't actually be included in the films story, but rather narrating or being told the story of the film from the outside. Personally I think it's actually better to see Wood return as Frodo since he did such a great job in the role in the last three films and audiences have already grown attached to him and the Lord of the Rings series.
According to

As readers of “The Hobbit” know, the tale of “The Downfall of The Lord of the Rings” and “The Hobbit or There and Back Again,” are contained in the fictional “Red Book of Westmarch.” In Peter Jackson’s LOTR films, the books are shown on screen and written in by Bilbo and Frodo and handed off to Sam Gamgee. (Not explained on film are Sam’s progeny later having the book and being Wardens of the Westmarch — hence the book’s title.)

The fictional book, and either the telling from it or the reading of it, will establish Frodo in the films experiencing Bilbo’s story. Viewers too learn the tale of ‘The Hobbit’ with a familiar Frodo getting the tale as well.

My prediction is that Ian Holm might return to play the older version of Bilbo Baggins telling the story to Frodo throughout the film. The current cast and casting rumors are as follows:

Cate Blanchett -Galadriel
Saoirse Ronan -Itaril (rumored)
Orlando Bloom - Legolas (rumored and also not included in the original novel)
Martin Freeman - Bilbo Baggins
David Tennant - (rumored)
Ian McKellen - Gandalf
Andy Serkis - Gollum
Richard Armitage - Thorin Oakenshield
Leonard Nimoy- Smaug (rumored)
Mikael Persbrandt - Beorn
James Nesbitt - Bofur
Aidan Turner - Kili
Brian Blessed - (rumored)
Graham McTavish - Dwalin
Robert Kazinsky - Fili

The Hobbit: Part 1 will be released in theaters December 19 2012, and Part 2 will be released sometime in December of 2013.
What do you think of Frodo being included into the story of the Hobbit?