This can still be killed in response to trigger during upkeep, right? Is that intentional?

I didn't really think about that, how would I change it so that he can't be killed in response?

'While you control another Hobbit, ~ is indestructible.'

He's pretty damn strong making all other creatures indestructible, maybe just:

'While you control at least two Hobbits, Hobbits are indestructible.'

Steadfast is a triggered ability, though, and I want him to have steadfast. Maybe the ability to be killed during the upkeep is a good way to balance his power.

Removed lifelink and added to mana cost for balance.

I haven't read every card, but it looks like Steadfast always grants indestructible, if so how about templating it like this:

Steadfast - As long as (something), ~ has indestructible.

That makes it static and simple and prevents it offering a trigger window for Sam.

Is giving +0/+1 relevant when he already makes them indestructible? Could relive that and leave him at 2cmc?

I'd forgotten Indestructible is now a keyword.

'As long as' and 'whenever' are very different. Most of the other cards with steadfast have triggers that wouldn't work or would be very wordy as static abilities, so I think the trigger window here is fine. This might be too powerful without it.

EDIT: Removed toughness boost, added back lifelink.