Despite admitting the Dalglish factor hindered his chances of success at the club, Hodgson maintains the Scot should now get the job full-time.
Asked if he would have been there longer had Dalglish not been in the background, Hodgson said: "That may be, who knows? It's difficult to compete with icons.
"I took a risk going there with a change of ownership in the offing and in order to win the fans over we needed a flying start.
"I knew that from the moment I walked in because Kenny had made it clear he wanted the job.
"When you don't get that, I'm afraid you are at risk as a manager - especially when there is a man of Kenny's iconic stature waiting in the wings and prepared to take over."