How we cite our quotes: (Line)
Quote #1
By good angels tenanted, (2)
This line kicks off the generally happy vibe at the start of this poem. Any place where good angels would live has to be a happy spot, right? It also fits with the supernatural themes of this poem—there are spirits everywhere in and around this palace. At the same time, we never actually hear anything else about those angels, so it could be that this description is metaphorical.
Quote #2
And every gentle air that dallied,
In that sweet day, (13-14)
This line makes us think of the most beautiful summer day. Think of the best day you've ever had at the beach, when it was warm, but not hot, when it was breezy but not windy—just like that. The speaker's emphasis on the "gentle air" and the "sweet day" really helps to bring that idea home.
Quote #3
Wanderers in that happy valley, (17)
Now the speaker just comes out and straight-up tells us that this valley is a happy place. He even reinforces that feeling by calling the people who are heading through the valley "wanderers." They're not in a rush. They aren't going straight from point A to point B as fast as possible. They're wandering, just like happy people would.
Quote #4
And sparkling evermore, (28)
At a certain point, before everything falls apart, we almost get into My Little Pony territory here. Everything is so happy and sparkly and gem-encrusted and shiny that it almost makes our teeth hurt. It's almost as if the poem's description gets wound up to the point where something has to give. And it definitely does…
Quote #5
In voices of surpassing beauty,
The wit and wisdom of their king. (31-32)
The spirits of the palace are so happy that they sing constantly (and sound great, of course—no off-key singing here). They sing to celebrate how wise and smart their king is. If we follow the epic metaphor in this poem, that the palace is like a human head, then at this point all is well with the symbolic head. The mind is still sane and happy, so the speech that comes from the head is evidence of that wise and cheerful mind.