I've also been wondering about the logistics of holding a quest at a convention or something - with careful selection of rooms, it seems the logistics of it wouldn't be impossible to recreate using a home setup these days...

We know of various conventions etc which have had playable Knightmare recreations:

Q-Con XIII and XIV (2006, 2007). These conventions, hosted by the Queen's University of Belfast Gaming Society, included Qnightmare. Michael Cule (Brother Mace) was involved. Details in this thread; search for Qnightmare on YouTube for video clips.

Knightmare Convention (2014). While we limited ourselves to the Corridor of Blades - which allowed more people to have a go than if we'd attempted full quests - we did have a Knightmare Live show beforehand on the Friday. Knightmare Live's done a few other conventions as well.

Lazlar Lyricon 3 (2017). A Hitchhiker's Guide To The Galaxy convention. Like Knightmare Live, this was done in a physical setting. David Learner (Pickle) and Michael Cule, guests at the convention, were involved.

IDW Con a.k.a. The Irish Discworld Convention (2019). Information about this seems to be scarce, other than the programme and a recent tweet.

Dungeonjarg (2020). As posted about on the website last year. Rather than using chromakey for the quest, it appears they used physical locations and then switched to augmented reality.