Re-watching my Muppet Show DVDs (Why haven't seasons 4 and 5 been released yet?) and just saw the Pearl Bailey episode this morning.
Okay, so throughout the episode, Floyd is bitching about having to be a knight for the jousting scene in Camelot. Eventually, Floyd just goes along with it, but as that happens Scooter goes to Kermit and says that the guys who wrote Camelot won't let them do the scene unless they get money. (Kermit spent most of the money on two suits of armor.)
So, Kermit goes out to introduce a scene that's almost, certainly not at all like the jousting scene from Camelot.
The curtain opens and everyone is dressed in medieval clothes and they begin to sing "Ascot Gavotte" from My Fair Lady.
I laughed so hard that I had to back up the show to hear all that I missed.
An excellent joke, Muppet writers. Totally unexpected and, as Bullwinkle once said, "Thousands won't."
(Also, did Pearl Bailey ever play Dolly Levi in Hello, Dolly!? After her little bit of singing the title song during that sketch all I want is to see her in that role. She would have been so much better than Streisand.)