Where It All Goes Down
England, Ireland, Cornwall, France, and Western Europe in the Middle Ages
Since Arthur is king of "all England," it's unsurprising that much of Le Morte D'Arthur takes place there. But it's also a really big deal that Arthur manages to defeat Lucius, the Emperor of Rome, and, on his way home, get all the places he passes through to yield tribute to him as king. That's a lot of ground to cover.
This kind of conquest is what Arthur's knights engage in on a smaller scale as well. Each time someone like, say, Launcelot conquers another knight, he sends that knight back to him to yield to Arthur as king. If that knight happens to possess lands and vassals, those resources now belong to Arthur. This is the feudal system at work, with Camelot and Arthur's court as the center of power and order. As long as all the lands around him are submitting to Camelot and Arthur remains there, things go well for him.
However, through Launcelot's dispute with Arthur, Launcelot and a bunch of knights defect and return to his ancestral lands in France. This move takes this portion of Arthur's tribute with them, which changes the map a bit. Plus, it was Arthur's alliance with Launcelot's relatives, Ban and Bors, that gave him these all-too important lands in the first place, which helped him solidify his power. So when Launcelot skips town and takes those lands with him, it represents a crushing blow to Arthur's power. He has lost a strategically important region that has helped keep him in power. Now, there's no telling what might happen.
On top of that, Arthur makes a huge mistake by leaving Camelot to take back these lands from Launcelot. Once he leaves his center of power, Mordred makes his move and it's all over for Arthur, which just goes to show how important the control of certain geographic areas is to power in Le Morte D'Arthur.
Chivalry is NOT Dead
From the get-go, it's obvious we're reading about a time and place very different from our own. England in the Middle Ages was all about chivalry, and we're not just talking about holding the door open for your date. Much of what goes down in Camelot goes down because of the chivalric code that was the law of the land in Le Morte D'Arthur. Closely related to the feudal system, chivalry demanded absolute loyalty from its knights, with the added rule that they should be kind to, defend, and honor ladies, and not just their own.
But this isn't just about wooing the women-folk. It's about honor in general, and understanding chivalry helps us understand many of the events in the book. For example, Lamorak's murder is so unforgiveable, because in chivalric terms, stabbing someone in the back is the ultimate no-no. If you kill a man, he had better be facing you. And he had better be armed. It also helps explain why Gawain is such a ne'er do well. Not only is he part of Lamerok's death, he also totally ignores multiple damsels in distress. No wonder it takes him so long to make a name for himself at the Round Table.
Plus, chivalry helps explain why many of these knights do things that seem downright foolish. Why won't Launcelot just marry Elayne? Because he's devoted to Gwenyvere, of course. And why won't he battle with Arthur? Because he's sworn his loyalty to him. For all the trouble it causes, you can say one thing about chivalry: it sure makes decision-making easier. In Medieval England, despite all the drama, things were pretty black-and-white.