^Ahh, but the Tolkien films, like most big-budget action films today, create CG doubles of the live actors for the big action scenes. So needing a CG character for an action scene does not preclude casting a live actor in the same role for other scenes.
Indeed, this was true long before CGI; in many films, live actors have been doubled with animatronic replicas for FX scenes, and actors who've been faked to appear large or small have been doubled by appropriately-sized people in shots where interaction is required. Even Peter Jackson does this; every hobbit and dwarf character in the movies has a Little Person double for the main actor, with the face being digitally replaced.
It is now clear to me that this friendly intellectual debate shall not be resolved by words alone. I therefore propose a game of billiards in the City of San Francisco sometime this week, in which the loser shall publicly acknowledge the winner's position to be the superior one; as the challenged party, you may choose the venue and take the first shot.