Of course, it won't matter WHO plays the dog, since the movie will be CGI-motion capture, and will have a semi-realistic look. Spielberg and Jackson aren't letting the writers strike, or the threatened actors strike stop them from their planned trilogy. (Though a September 2008 start date could get pushed back in an actors strike happens in July and it lasts a long time.)
Spielberg and Jackson will each direct a movie, and it isn't yet known who will tackle the third film. Rumors pointed to the two co-directing, though I don't know if that will happen. It makes sense, given that both are legendary directors with similar extravagant films (well, Jackson DID make some awesome splatter films years ago, like the gruesome and hilarious Dead Alive), but they're both legendary directors with singular visions. Maybe George Lucas?
This sounds like fun; if all goes according to plan, the first film will be released in 2010, in time for the Jackson-produced The Hobbit film adaptation.