The joy in giving a gift is in the giving. When we do neighbor gifts, we love saying hi to our neighbors and the smiles from their kids as we give them something. We expect nothing in return. If they don't give us gifts, that's great. If they give us cheap gifts, that's great. If they give us expensive gifts, that's great too. I don't really care.
Also, we don't stress about doing it every year. This year we didn't get around to neighbor gifts. No big deal. They know we still like them, gift or no gift. Hopefully we get back to it next year. It's a great excuse to get around and say hi to everybody, so I enjoy that.
I guess I just don't think about it too much. If we get around to it, then we give, and we give what we think sounds fun. It changes every year. What we get back from our neighbors also varies year by year depending on how busy they are. Maybe that's why it works — nobody has any expectations for each other.
Except my non-LDS neighbor who makes us cheesy garlic bread every year. I have grown to expect that ... it's so good, and he does the same thing every year. We just ate it tonight.