How will the hobbits be made to look smaller when they are on horseback?
Camera trickery will play a large part in making the hobbits look small in proportion to the horses. For horseback scenes, the hobbit actors will ride either extremely large horses or fake horses. For some shots, the horses will be real, but the hobbits themselves will be fake. When edited together, these shots will look seamless and the hobbits will appear to be appropriately small.