Thanks for the heads up - I went to BFI Southbank earlier on today to investigate. You can use the Mediatheque there for up to 2 hours, and the guy who set me up whilst explaining how to use it also stated that all 2,000+ programmes on the Mediatheque database (including Knightmare) are from the BFI National Archives, so that should answer Mystara's question.
As for the episode of Knightmare featured on the Mediatheque itself, yes its from an 1988 episode but I won't spoil things by saying exactly which episode - I'd rather that people headed over to the Mediatheque themselves to find out which episode it is. All I will say is that the Mediatheque description put a strong emphasis on the word "hapless"....
If you get a bit of spare time after watching the Knightmare episode I strongly recommend searching for
Moondial - another children's TV programme that dates back to 1988, and whilst it doesn't have the adventure gameshow element, it resembles almost everything else of Knightmare in terms of chilling fear factor and darkened edginess.