I think the asterisks did work really well, they help create a sort of visual map of the "conversation" (this does almost strike me as skirting the edge of visual art, too).

I wanted to try to show that by making himself think of himself in second person, he was trying to distance himself from the "Smeagol" who'd killed his friend; but it gave an opening for "Gollum" to take over.

Aside from being a nifty psychological device, it helps explain Gollum's odd speech patterns.

I'm sorta repeating myself a bit, but, yeah, really thought this was innovative, bears repeating.