End Notes:

Never? Or did it almost happen like that? Believe it or not, that was more or less the original shape of the story.

This "dream sequence" was inspired by the following passage in The History of The Hobbit, the chapter entitled "Plot Notes C", and which shows JRRT's original outline for the death of Smaug and the role Bilbo played in it. ( "Blad." refers to "Bladorthin", which was JRRT's original name for Gandalf.)

B. creeps in third time and waits in shadows till Dragon creeps out of hall.
He steals a bright gem which fascinates him.
The dragon returning finds theft: and is awful rage.
He goes to war with the Lake Men. The people sees [sic] him coming and cut bridges to lake-dwelling. D. flies over them and set houses alight, but dare no settle right in lake. They quench fire with water and shoot darts at him. Glint of gems in dragon's belly in light of fire. He settles at the side of lake and tries to starve them out.
Dwarves see the steam from afar; and are bent on carrying out gold. B. watches them stagger out. But warns them D. will come back to entrance of tunnel? What can they do with gold.
Burglary is no good-- a warrior in the end. But no one will go with him. Bilbo puts on ring and creeps into dungeon, and hides. Dragon comes back at last and sleeps exhausted by battle.
Bilbo [takes>] plunges in his little magic knife and it disappears. he cannot wield the swords or spears.
Throes of dragon. Smashes walls and entrance to tunnel. Bilbo floats away in a golden bowl on D.'s blood, till it comes to rest in a deep dark hole. When it is cool, he wades out, and becomes hard & brave.
Discovers sources of Running River and floats out through Fro[nt] D[oor] in a golden bowl.
Found by the scouts of the Lake-Men.
The dwarves dig through the tunnel and take possession of their old homes but the gold is mostly crushed, and they cannot use it because of the dragon's body.
The men of < the > Lake and Woodelves come up and besiege the dwarves. Attempt to block F. Door.
Bilbo sorrowful meets Blad. in the < illegible > place of Laketown.
Blad. rebukes the besiegers. And makes dwarves pay Bilbo.
A share of his < part > he gives to Lake-men, and to wood-elves (though they may not deserve it).
They escort Blad & B. back through Mirkwood.

This entire page, from 'B. creeps in third time' to 'back through Mirkwood', was struck through with a single slash. At the same time that this page was cancelled, Tolkien wrote in the left margin of this page and underlined:

Dragon killed in the battle of the Lake.

This change dates from the same time as the two new pages that replace the canceled page were written, which was demonstrably after the next chapter (Chapter XII_ had already been drafted, and probably most of the following chapter as well.

As you can see, JRRT originally envisioned Bilbo as ending up playing a far different role in the story than he did in the end. I like to think that the story that we ended up with is the story that was "meant" in the same sense of the word as Gandalf used when he told Frodo that "Bilbo was meant to find the ring, and not by its Maker." But it is interesting to explore the ideas that JRRT played with before he settled on the final shape of the story.

Even if, in this version, the ring was not that important, Bilbo would still have returned with a not quite wholesome reminder of his Adventure, for mythologically Dragon's blood is a very powerful symbol. Having come in contact with it, he would no longer quite be the hobbit he once was. He would become "hard & brave". Of course, Bilbo was already brave before that but it was a hobbity sort of courage-- now he would be "hard". What would that do to his future personality?