When Merlin told Gaius he had something to do, I really thought he was going to tell Arthur his secret. :( I'm not sure if the whole sword-in-a-stone thing has anything to do with the actual legend, but it was a good touch, although I thought it was safer in the lake. :s Anyway, I hoped there would be more Freya in this episode, no such luck - but maybe they're saving that for Series 4.
It was in general, pretty good, the only "I don't get it" part was Morgana and Morgause's escape. I doubt Morgause, whom is a powerful sorcerer is dead, but I wished they had shown them escaping into the woods or something. Morgana crying like a banshee was a little odd.
It looked like Gwen chose Arthur over Lancelot, much to my pleasure. :D