Arthur and his guys are now at Carlion, which is apparently another stronghold of the Kings. They're making plans to put a stop to King Lot's rebellion. This involves secret help from overseas, and ambushing their opponents at night. Now that's not very chivalrous, is it?
After traipsing up to Merlyn's tower (208 steps, ugh), getting rebuked by Merlyn for not following protocol (the King should never walk all that way; Merlyn is a servant so should be summoned), Arthur settles down to a council with Merlyn, Sir Ector, and Sir Kay.
Apparently, Arthur has finally done a lot of thinking about chivalry and Might and Right, and has now reached some conclusions.
Hold onto your seats for this earth-shattering revelation: It's better to be alive than dead.
Arthur has recognized what seems to be hypocrisy on Merlyn's part: If M is so against wars, and is such a pacifist, then why is he trying to help Arthur win the war against King Lot?
But wait, folks—he's not done yet! Arthur thinks he has the answer. Merlyn wants to help Arthur win, because once he is King over a united realm (once he's whipped the Gaels into shape, so to speak), he can turn his attention to doing something about chivalry—the other form of Might in the kingdom.
The King envisions harnessing Might, which is currently being used for bad purposes, and using it for good purposes.
His idea is that he'll start a different order of chivalry, and try to include Lot and the other knights. This order will still ride around wearing armor and whacking at stuff, but it will be for defense only, and all for good.