I feel that the first chapter was not only an introduction to Middle-Earth for the non-initiated, but also an introduction to the Kuduk culture for those who had only read The Hobbit before. Tolkien establishes early on that Bilbo, as much as we loved him from the previous work, was very much different from his fellow Hobbits, and so this was a look at Hobbiton, in particular, up close. We see the personal politics, get a feel for the government, understand the Hobbits suspiscion for outsiders, all from this first chapter. Those who have problems later on telling Merry and Pippin apart (Why, they are as different as a Took and a Brandybuck!), have not read the first chapter carefully. I believe the good Professor wanted to flesh out this simple and healthy people, and he has a very good start in the first chapter.
When reading The Hobbit, I knew the book worked on a much deeper level when not only Thorin died, but Fili and Kili also. I remember saying outloud... "Not Fili and Kili..." And crying... then laughing at myself for crying over dwarves!
Tolkien also has a wicked wit... and not only do his characters say funny things, but the situations they find themselves in are funny. Humor bypasses the head and goes straight to the heart.
At first, I didn't like the idea that Bilbo was going away. I didn't know if I would like this Frodo... but by giving Frodo a colorful supporting cast... causing us to like them and showing us Frodo through their eyes, Tolkien very adroitly weans us from Bilbo to Frodo and before we know it we are off on another adventure. Not with 13 grumpy dwarves, but with 4 Hobbits that we have come to like within the first chapter or two.
How about favoring with a little comparison and contrast of Merry and Pippin? I would enjoy that.