Watching Hugo Weaving play Elrond was very amusing (although I'm sure it wasn't supposed to be :). It was just the tone of voiced he used made everything fit so well into his Agent character from the Matrix. "It's the.... RING, Frodo..."
Of course, the scenery was great. CGI was used sparingly, which of course made it perfect. Are you listening, Mr. Lucas? Acting was perfect. And it was true to the book.
It was also three hours long... Given the length increases in the books... hmm.