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Bilbo takes it upon himself to save the dwarves while they are in distress. Bilbo saves to dwarves from the spiders and from the Elvenking's dungeon. Bilbo also takes a leadership role in trying to comprehend the riddle to open the door in the Mountain were Smaug lives.
Bilbo is turning into a real leader because he keeps saving his people and can also steal things from Smaug. He can also figure out the riddles that has never been figured out before.
Bilbo demonstrates selflessness multiple times in "The Hobbit," most notably when he offers to take on the role of burglar for the dwarves despite his initial reluctance and fear. He also risks his own safety to save the dwarves from spiders in Mirkwood Forest and from imprisonment by the Wood-elves. Additionally, Bilbo shows selflessness when he spares Gollum's life during their encounter in the dark caves, choosing not to kill him despite the potential threat.
Great question! Because Bilbo Baggins is so "respectable," and is not the sort who has adventures of any kind, it makes his later behavior stand out in stark contrast when he finds himself doing all sorts of "adventurous" things, like fighting spiders in the forest, and riding barrels to Laketown.
"It was pity that stayed Bilbo's blade." --Gandalf"Pity stayed his hand." Gollum was so pathetic that Bilbo didn't have the heart to harm him, especially as he (Bilbo) was invisible at the time.
He proves himself useful on several occassions. He rescues them from the spiders in Mirkwood. His warning allowed Gandalf to escape and rescue them in the Goblin Cave. He gets them out of the elf dungeon in Mirkwood. And then he gets them into the Mountain.
Yes, originally Steve Martin was attatched to the Han Solo role until he decided to drop out to begin pre-production on his passion project, The Jerk (1979).