Forget about where the baseboards are...they can be reset. Pick out an underlayment of the right dimension so that the combined thickness of the underlayment, the adhesion layer(s), and the tile bring the level of the bathroom floor flush with the adjacent hardwood floor. I can't recommend an underlayment since you don't say how thick the tile is, and what method you intend to use to attach the tile to the subfloor, including whether you will use something like a Kerdi membrane.

This post was edited by kudzu9 on Fri, Oct 31, 14 at 20:18

You can always cover the baseboard gap with some shoe molding that rests on the tile, covers the gap, and extends onto the baseboard.

I'd aim for making the tile even with the adjacent hardwood. How thick is your tile?

Thank you very much kudzu9 and weedy acres for your helpful responses. My tile is about 1/4 thick - which may present another problem. The tiles vary a little in thickness. If I stack 3 up next to the hardwood, they rise slightly above. I "think" I have enough to lay them out enough and get all the same height, hopefully 1/4. If not, I will return them. No matter what tile, now I know I'm shooting for 3/4 thick. So, is 1/2" underlayment too thick then taking into account the adhesive? Should it be 1/4? And now it sounds like the toilet will be about 1/2 too high? (Should have mentioned, this is half bath, very light use, 24sq ft.) thank you again.

If you use 1/2" cement backer board, it is usually slightly less than 1/2" actual thickness. Don't worry about the toilet flange: there are several ways to bring it up to the proper height, which is slightly above finished floor level. Do some further reading on selecting and installing the underlayment.

Here is a link that might be useful: Underlayment