"He wasn't the good wizard in every fairy tale, despite what River said. But when he wasn't the main character of the old folk tales, he often met those who were." Also posted on ao3

The Knights think Merlin has magic. Arthur and Gwen know Merlin has magic (but they don't know that either other know). Lancelot knows Merlin has magic and that the Knights think he has magic. Merlin is a bit clueless, to be honest. (it is basically me rambling about Merlin and how obvious he is and what was really happeing behind the scenes) (Also on ao3)