Most of what I find funny in Fable can be summed up in one phrase: Anything villagers say while drunk. :P
My favorite has to be when they start singing 'Show Me The Way To Go Home', or something the Armor Dealer in Bowerstone said:
"An, and then the bish-bishop says to the donkey... um, wait, no... tha's not right..."
And the game we (myself and a few Fable-Playing friends) invented: Chicken Kickin' Pinball. Object of which being to see how many buildings, objects, and people we can hit with a single chicken kick. I swear the chickens in Fable are made of rubber. :P
My record is a paltry 6, with no people hit. I'm still trying to figure out if its possible :P
And lastly, the way the Bandit's Bandana works flawlessly with either the Assassin or Fire-Cult Assassin's suit :P
Ninja-Arseface, Away!