It's definitely easy to do digitally. My "proof of concept" examples are completed in an ordinary paint program. It has Split Channel and Combine Channel functions to do that part of the work. The free Avisynth, and it's variety of function plug-ins, is the popular work environment that does on video what a paint program can do on stills.

As The Hobbit was a NTSC production, I wouldn't expect any improved quality from PAL sources. PAL releases are (almost?) always mash-ups of the original-NTSC releases, which probably would produce lesser quality.