Bilbo: Oh, up to but not exceeding one fourteenth total profit if any. Seems fair. Present company shall not be liable for injuries including but not limited to laceration, evisceration... Incineration?
Bofur: Oh, aye. He'll melt the flesh off your bones in the blink of an eye.
Balin: You all right, laddie?
Bilbo: Yeah, I'll be. Feel a bit faint.
Bofur: Think furnace, with wings.
Bilbo: Yeah, I-I-I need air.
Balin: Flash of light, searing pain, then poof, you're nothing more than a pile of ash.
Bilbo: [Long pause.] No. [Bilbo faints.].
In the scene with the rock giants the dwarfs and Bilbo get completely soaked by the rain. Once they reach the safe rock, you see Bombur land on his back and he is totally dry.
The blade that Gandalf presents to the high Elves and Saruman is the same blade that Frodo gets stabbed with in Fellowship of the Ring on Weathertop. Confirmed in the director's commentary. How the blade makes its way back to the witch-king hasn't been revealed.