I know he killed his friend, but Gandalf says something about what happened to him being all too likely to have happened to quite a few Hobbits in the Shire had they been in his place. This seems odd, since the number of evil Hobbits that we know of in the Shire we can probably count on one hand. Is it also possible that his obsession with new things and roots and beginnings made him particularly vulnerable to the Ring? Bilbo was willing to part with the gold of Erebor in order to make peace. He was quite resistant (I'm not sure if he was fully immune) to the dragon sickness too. So he, perhaps, more virtuous than your average Hobbit.