> This is probably way off the mark, but here goes:
>
> Hobbit byggði jörðhús. Þat var eigi hola saurfull ok aurig, drjúp
> ok blaut, eða maðkfull ok fúl, né enn hola þurr ok auð, söndug ok án
> sætis. Heldr var hobbithola, ok þat gegnir sællífi.

I think this is very amusing and well done :)
One correction; 'jörðhús' is, I think, not a
valid combination. The usual one is 'jarðhús'.

We might nativise 'hobbit' as 'hobbitr' or 'hobbiti'.
The last is one MI version. Another is 'hobbi'. I think
it's actually a bit interesting *not* to nativise it.
I wouldn't have thought of that. Nor would I have thought
of some of the adjectives you use and I think "þat gegnir
sællífi" for "that means comfort" is pure genius.

> Hopefully someone will correct my mistakes. I wonder how the Modern
> Icelandic edition begins...

I think yours is much more idiosyncratic and interesting.
The modern translations (I think there are two) are probably
too loyal to the English version to interest us.

Kveðja,
Haukur