I have become quite frustrated at this discussion, fueled in part by some flu-like symptoms. If I've offended anyone (and I'm sure I have), I apologize.
But this whole matter has caused me to do a little digging and reading, and I have concluded the following:
As to baptism, it is wholly the work of God to and for the recipient. Since it is wholly the work of God there is no real preparation necessary. The only thing necessary in baptism on the part of the recipient is the faith necessary to receive it, which is given by God. Baptism creates the faith necessary to receive it. No one can be harmed by baptism, thus it is possible for any baptized Christian to baptize, and it would be a valid baptism in the eyes of God (since it's His work) and of the Church.
The Lord's Supper, on the other hand, does require certain preparation on the part of the recipient, namely the recognition of the body and blood of Christ within the Sacrament, and acknowledgment of their sinfulness and their need of forgiveness given in the Sacrament (as per 1 Corithians 11). Because it is possible for someone to receive the Lord's Supper to their harm, more pastoral care must be exercised in order to assure that no one receive the Sacrament to their spiritual detriment. This is why God gave the stewardship of the Sacrament to those who are called and ordained by the congregation to carry out the functions of the Keys, so that all things are done in a good and orderly way.
The Confessions tell us plainly that the faith of the administrator of the Sacrament nor the recipient effects the presence of Christ's body and blood in, with, and under the elements of bread and wine. Even if an athiest were to administer the Sacrament according to Christ's command, it would be a vaild Sacrament. The Confessions also tell us that the Sacrament entails not just the consecration of the elements but the whole act of consecration, absolution, and distribution/receiving. These are contained within the Divine Service. Thus, in order for there to be good order and to assure the efficacy of the Sacrament to all who receive, it should be done within the context of the Divine Service (this can even be done with shut-ins and the sick).
Now, the question that was raised is if lay person, in their home or at the church or wherever, were to recite the Verba over the elements and distribute, would they be receiving the true body and blood of Christ. There are a number of variables to consider, such as the context of the act. If some children were playing "church" and they had the elements and recited the Verba over them as part of their game, would they in fact be receiving the body and blood of Christ? I would have to say no because the context of the Divine Service is not present. It is merely a game, so no Sacrament is present. But if it were done within a context of the Divine Service by the head of a household in their home (for whatever reason) it is possible that the Sacrament would indeed be valid, since it is the words of Christ that hold the power of the Sacrament. But there are some concerns that must be considered. What type of pastoral care is being taken to assure (as much as possible) that those who receive are doing so worthily? Is the service being conducted within the Confession of the Church (as per FoC VII)? With such variables, it isn't wise to attempt the Sacrament outside the setting of the Divine Service in the Church administered by a rightly called and ordained steward of the Sacraments.