I think that it'd work better to start with the Hobbit, though the Sil will eventually be more useful and interesting to those who have read it. The Hobbit would gather more participants for one thing. I also grew up on the hobbit from when I was starting reading chapter books on my own, so I may be biased towards it, but I feel discussing the hobbit would be better to go first between the two.
Of course I think after this Sil should also be done.
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