Point of View
Sketchiness
Monty Python has always been all about the sketches… and that's evident in the structure of The Holy Grail. Really, the whole first third of the movie is just a series of Arthur's random encounters, tied together only because he's there (and sometimes, as in the "bring out yer dead" scene, only briefly). Even when we get a more comprehensive narrative—the quest for the Holy Grail—it still comes packaged in an episodic fashion with each part featuring one of the knights as its protagonist.
Finally, the knights reconvene and go through a series of final tests (namely a rabbit, a beast, and a bit of trivia) in a more traditional adventure narrative. Really, even standard, non-parody type adventures can be thought of as a series of obstacles that must be overcome. These kinds of journeys naturally have stages and this is largely how The Holy Grail operates. But it's the kind of journey that, instead of leading somewhere, just stops.
Animation Station
So how does one turn such an episodic narrative into a single film while maintaining some semblance of coherence? One way is by creating special transition sequences in between the small stand-alone sketches, and especially between plot sequences that are separated by a period of time.
But the Pythons don't use a standard montage (that cinematic technique for showing the passage of time while maintaining plot continuity). Instead, animator (and director, and actor, and writer) Terry Gilliam takes drawings from old texts and repurposes them with his psychedelic twist, as silly moving pictures that move things forward and imply the passage of time.
Gilliam perfected these kinds of sequences in "Monty Python's Flying Circus." It's extremely low tech (in fact it's been described as "no tech "). You can check out our "Best of the Web" section for all the details on his sources of inspiration.