This is an interesting card. First of all, 1 , 2 , and 2 for a 2 cost ally is very good. The two is especially useful in , a sphere that can struggle to gain significant , and the 1 also comes in handy in case you don't need the (2 resources for two of a stat is generally a good deal with an ally). The extra hit point also comes in handy for absorbing archery damage or other damage from the encounter deck. The hound can't have attachments, but that's alright because it has a great stat line.
If that was it, Loyal Hound would already be a good ally. But it gets better, the pooch also comes with a response. The response is basically a safety net, and every deck could use a safety net around. It's great for guarding against nasty shadow effects, treacheries that cause damage, or letting you defend against a more powerful enemy in a pinch (even against enemies that are immune to player card effects because this affects the hero, not the enemy).
This card combos very nicely with Radagast (because the hound is a creature), enabling his ability, coming in for free with Radagast's Staff, and preventing damage on the wizard (who is likely to be defending anyways). The hound could also work well with Hobbit heroes who could use the safety net with their low . Overall, a great card that is very splashable and can improve almost any deck it is in (and the artwork is amazing too).