WHEN IT COMES TO George MacDonald, do not read or entertain any critic's "good" advice, but go to the source. First read his Phantastes, then Lilith. If you have lived longer than half a century, (or if you have had a life-threatening illness, lost a parent, a spouse, or a child at any earlier age), you should first read C. S. Lewis's introduction to Phantastes in the edition I linked to (above).
Read these books in a spirit of lectio divina, and forgive their lack of adherence to the Magisterium of Mother Church (the way you forgive an uncle who has lived an adventuresome life, has great stories to tell with gusto, and who loves you enough to spend/waste all the time you want with him over a strong beer or glass of mead). Keep to the Magisterium, but let MacDonald re-enchant the world for you. Why? I was hoping you would ask!
The third book I cannot recommend highly enough is an absolutely essential read for all modern and post-modern denizens is David P. Lang's Why Matter Matters (NOT Simon Basher's book of the same name). Amy Welborn recommended it to me, and it is a vital part of the Catholic counter-culturalist's library.
Besides being a thorough-goingly orthodox Catholic book, it will unequivocally disabuse the reader of all the semi-Gnostic and full-blown Gnostic falderal we all have accrued living in our bland secularist landscape of dumbed-down wonderment in which the only end-point, apparently, is Freudian (a six-second promiscuous rush of rattling a ladle in a bowl ... ).
In actuality, MacDonald and Lang accomplish the same feat: both re-enchant and valorize this wondrous world and make one realize that if we can trust in the Providence that placed us in this world, we can trust that same Providence to help us safely, surely, and meaningfully into the next world as well.