,,, Peter Jackson made his first film "Bad Taste" in the mid 1980s on a very low budget. A lot of the scenery in that film was shot in Makara, a hilly wind swept area behind New Zealand's largest suburb, Karori (Wellington). From the outset Jackson's attention to detail when it came to blood and guts massacre scenes was obvious.
His 1990s film "Heavenly Creatures" was first class and a quantum jump in ability. I haven't seen the Lord of the rings movies yet but went on site during construction at one of the location shoots at Kaitoke, north of Upper Hutt. He's spent a lot of time working out the right areas to shoot in.
I'd recommend you rent or purchase the extended version DVD of the Fellowship before seeing the Two Towers. It makes what was already an excellent first film breathtaking. In particular, the length and detail of the battle scenes and the added scenes describing the characteristics of Hobbits and Elves, make, IMHO, the expanded film much truer to the Tolkien.