Its well known that Tolkien was uncomfortable with dramatisations of fantasy/fairy stories generally - see his comments in OFS for example. I suspect that he would have felt that out of all the various movies Jackson's version was the best overall adaptation. Having said that, we know that this
adaptation (the only one we can presume he would have seen) did meet with authorial approval for the performances (Bogart's Frodo is in many ways superior to Wood's) if not for the modern day setting. Chandler's script does of course omit many of the subtleties of the novel, but Hawks' direction manages to communicate the deeper themes well.