Le Morte d'Arthur is so splendid-- after reading it last year, it began to surprise me that anyone would want to retell something that had already been done so brilliantly. The final books are amazing, and I consistently find myself a bit teary when finishing them. The ending is perfect.
Anyway, that said, I like a number of the retellings. Gerald Morris's YA spoofs on Arthuriana are anachronistic, clever, and often laugh out loud funny (particularly if you've read the medieval works they're based on; Sir Gawain and the Green Knight gets a redo, as do Malory and Chretien de Troy episodes). The Savage Damsel and the Dwarf is my favorite; it takes the less popular episode with Beaumains (Gaheris, properly, I think?) and Lyonet and Lyonesse. None of them are particularly profound, but they are a lot of fun. I also like The Once and Future King, though it was required reading during high school, which dampened my appreciation of it.