Order of Reading
The second generation of Tolkien readers has added a layer to the perennial question of what someone should read first: The Hobbit or The Lord of the Rings. If I hadn't met some of these new standard bearers online, I never would have dreamed that some people might think the first Tolkien book a person should read is The Silmarillion. But - for what I believe would be a small minority of readers - they may be right. The question of the best order for reading Tolkien's books has gotten a lot more complicated over the years. Here's my latest take on the subject (which began as a forum post that grew past the word limit).
I read LotR first, as a teenager, and I'm very glad I did. If I would have read The Hobbit first, the "children's book" feel of it would have put me off (Tolkien even said years later that if he'd been writing it at that point, he wouldn't have "talked down" to the readers so much). "Of the Finding of the Ring" in LotR's Prologue tells you everything you need to know about the story of The Hobbit to get you completely up to speed for LotR.
Now, when I started reading Tolkien, those were the only books that had been published! Yeah, I'm old, so...?
The Sil was published more than a decade after I first read LotR, so I have no idea how I would have reacted to reading it first. But I think the fact that the acceptance of LotR led to the publication of the Sil - rather than the other way around - says something. Reading LotR is what led many people to want to know more about Tolkien's secondary creation. For the vast majority of people, I believe reading LotR first (before the Sil) would be the best choice. The Sil, after all, was originally published specifically for people who were already obsessed with LotR (like me).
The exception might be someone who's already geekily interested in high/epic fantasy and/or related role-playing games (and I'm using the word "geekily" there in the best possible sense). In that case, reading the Sil first might be an enjoyable experience. Again, I have no way of knowing; since LotR was responsible for fantasy literature becoming a recognized genre, that kind of reading material didn't exist when I read LotR. LotR was truly a one-of-a-kind experience (and, of course, it's still the best).
So, my advice would be to first read LotR and the Sil (the order of the two based on your interest - if you're not sure, go with LotR). This is a big change of opinion for me that's come from reading the views of second-generation readers. Previously, I never would have suggested the Sil be read before The Hobbit. But if you read The Hobbit after you read LotR and/or the Sil, you'll have more appreciation for some of the stuff that's buried within that children's story.
If you start with LotR and find it tough to keep track of names, places, events, etc., skip the Sil and go directly to The Hobbit. The Sil is much more difficult in that area than is LotR. Do the same if you're bored by LotR's appendices, as they're basically a sampling of what's in the Sil. You can always read the Sil later if you want (after all, it was published later).
As far as Middle-earth is concerned, The Hobbit and LotR stand in a privileged place, because they're the only two books about his secondary creation that JRRT published during his life*, allowing us to be sure of what he intended to write. Most people also include The Silmarillion in "Tolkien canon," although some scholars argue over whether some of the material in that book should be included because JRRT wasn't around to approve the finished product. The same arguments would exist about The Children of Húrin, only moreso because JRRT did, at least, hope to publish The Silmarillion. Publishing The Children of Húrin as a stand-alone story wasn't something he considered during his lifetime. In a similar position would be Unfinished Tales, which also needs to be approached with the understanding that the tales in it are in lesser or greater states of being... well... unfinished.
If someone's interested enough in Tolkien's writing to get through The Hobbit, LotR, and the Sil, they're very likely to want to go on to The History of Middle-earth. But many people are disappointed in HoMe because they start reading it without understanding what it is. HoMe isn't the history of Middle-earth itself but of the creative process through which JRRT brought it into being: layer after layer, draft after draft, alteration after alteration. It's reference material, not a story. It's fascinating if you're interested in what went into the creation of the greatest fantasy literature ever written, but you won't find any finished work to read there.
I'd very strongly suggest that a reader, before getting into HoMe, become familiar with the published volume of Letters. It gives in outline, and from JRRT's own pen, the history that HoMe digs into more deeply. It also gives a glimpse of the man himself, which can be very useful in understanding his subcreation. The entire thing doesn't need to be read completely straight-through. Use the book's very good index to locate letters of interest (which will keep changing as you dig deeper, believe me).
After the Letters, pick up The Tolkien Reader. Everything in it is marvelous, but the two most important pieces are the essay "On Fairy-stories" and the short story "Leaf by Niggle," which puts much of what the essay says into a story, and which is also the closest thing to an autobiography that Tolkien ever wrote.
IMVHO, that's the place in the process where HoMe becomes the most useful.
I haven't even touched on books about Tolkien (except for the extent to which that label applies to HoMe). I have two biographies on my suggested "Basic Tolkien Reading List", but what someone wants to read next will very much depend on what aspect of Tolkien's writing they're most interested in.
*Being a professor and all, he published a lot of other things during his life.