Movie
Excalibur was developed after Boorman's failed attempt at filming a live attempt at LOTR; Boorman then went on to film an adaptation of arthurian myth that has strong Tolkien influences. In Boorman's vision, this tale is set thousands of years after the war of the ring, when magic is almost completely gone from the world and Middle Earth is now just becoming Europe; Merlin is one of the last of the wizards (perhaps a blue wizard) and Uther and Arthur are the last descendants of the line of Gondor; Excalibur is none other than Narsil; Merlin intends to go west before Morgana's betrayal("This world is not for me anymore") and his whole purpose by the valar is to mold Arthur as an example of how to rule to a godless unmagical future; and the lady in the lake could well be Arwen given some sort of semi-immortality to look after Gondor's line. The grail is none other than an artifact of the valar or of an earlier age, and when Arthur sails into the west at the end, he is being taken to the Undying Lands, having been given the only honour of doing so for being the last of Gondor's line.
A lot of this is based on leaps of imagination by myself and it isn't canon but it is a nice merger of the two tales.
