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I think the biggest reason is that the actors were allowed to act together. Modern movies use so many digital effects that actors aren't even on set together sometimes. It's hard to have the same emotions looking at a green screen and a guy in a morph suit.
Just for the first one, right? I remember Ian Mckellen had a breakdown on set because he was sitting in front of the table at Bag End with nothing around him but green screen and was struggling without any other actors.
IIRC that was on the set of one of the Hobbit movies.
The Lord of the Rings was shot mostly using practical effects.
The first three movies were mostly all filmed at the same time.
That's true, but it was a single scene, not the majority of the movie. Almost every scene with hobbits involved forced perspective.
IIRC in The Hobbit films they couldn't use forced perspective because they were shooting native 3D.
Thank god that trend is over.