In an interview with MTV, Jackson stated that he would like to see Cate Blanchett and Hugo Weaving return as the elves Galadriel and Elrond, respectively. The story of The Hobbit takes place 60 years before events in Lord of the Rings, and since elves are immortal, Galadriel and Elrond would not have changed much in appearance. The same goes for the wizard Gandalf, and fans are anxious to see Ian McKellen return in that role as well.

There's nothing definitive, however, and Jackson gave an update as to where things stand with Blanchett and Weaving:

We have a process that would start with showing them the script. We're not [beginning] any official process until we have the "official" script that they can read. We already know that McKellen has seen the script, even gotten a copy of his own. So the question now becomes where Jackson, del Toro, et al are in the writing process.... It's two movies, and we've written the first script, which the studio responded well to. And we're now halfway through the second script.

Elrond does make an appearance in J.R.R. Tolkien's The Hobbit, although Galadriel does not. However, including her does not seem like it would result in excessive artistic license. She is well present in the mythology and could easily be worked in to the story without diverting too much from Tolkien's blueprint.