Without addessing some of the major points in the discussion here, I would like to offer a slight observation about what can be said of dwarves, as I believe a special case is made of their relationship to the rings. My references are to Appendix A, "Durin's Folk".
There are several passages which suggest that dwarves were more impervious to the Ring's ability to inflame desire for power than other peoples. Among Durin's Folk, it was believed that the dwarven Ring was the first of the Seven to be forged and was given to Durin III, King of Khazad-dűm, by no less than the elven smiths themselves rather than by Sauron (who of course still had his hand in forging it). (II am rather shamelessly paraphrasing and condensing Tolkien here.) The Ring was held in secret by the dwarven kings.
The particular power of the Ring over the dwarves is explained thusly:
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None the less it may well be, as the Dwarves now believe, that Sauron by his arts had discovered who had this Ring, the last to remain free, and that the singular misfortunes of the heirs of Durin were largely due to his malice. For the Dwarves had proved unmanageable by this means. The only power over them that the Rings wielded was to inflame their hearts with a greed of gold and precious things, so that if they lacked them all other good things seemed profitless, and athey were filled with wrath and desire for vengeance on all who deprived them. But they were made from their beginning of a kind to resist most steadfastly any domination. Though they could be slain or borken, they could not be reduced to shadows enslaved to another will; and for the same reason their lives ere not affected by an Ring, to live either longer or shorter becasuse of it. All the more did Sauron hate the possessors and desire to dispossess them. [my bolding]
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I suppose this can actually suggest a reason why a dwarf could not carry the One Ring, that dwarves had already drawn the wrath and malice of Sauron and might be greater targets than Frodo.
Still, I think it is clear from the Appendix that the dwarves might indeed have the strength not only to take up the challenge but to persevere. That in itself might provide less dramatic potential than the slow process of Frodo's struggle with the Ring. Yet let us give the dwarves their just due.
As an interesting extrapolation of this,we might consider if in fact the body of LOTR, the text proper as opposed to the addenda, supports this view of dwarves as impervious to domination. And, indeed, if The Hobbit and The Silm do as well. Is this quality as apparent in the texts as it is in the historical documentation? If not, that might account for the very different interpretations of dwarves offerred in this thread.