I would have to say that for me the outdoor scenes where the way to go for knightmare, they brought the show on so much onto new dimensions if you excuse the phrase. They gave the show a lot more reality and believablility. I used to love the bit where the dungeoneer got into the boat with that weird boat guy that was brilliant and he had to be payed for his service.
I think a blend of both the blue screen dungeons and the outdoor areas where best for knightmare. I actually didnt mind the eye shield myself but i understand your point about who was guiding the dungeoneer whilst the advisors were looking through the eye shield. I love all the knightmare series and all the parts of the show that they tryed to experiment with also as this was very good for the show and its ratings in the early days of KM