Well, I'm not a Yank nor a Brit, so I'll just put in my two cents with the hope that I don't offend anyone.
If I recall correctly, whenever the King is formally announced (in the film), he is intoduced as "By the grace of God, King of Great Britain and Northern Ireland, Head of the Commonwealth, Defender of the Faith".
And Ralph Jones (John Goodman) also uses the same words when turning over the throne to Cedric.
I think this answers some of the questions on "King of England" and someone also mentioned other countries like Canada. But, yes, in some parts of the film Cedric (Peter O'Toole) and Duncan also mention "King of England" but I doubt they would use the entire phrase everytime (even in private).
Someone here said that Brits use the term "Prime Minister" as opposed to Prime Minister Hale, or Mr. Prime Minister. If I am remembering correctly, then all the British characters refer to Hale, simply as "Prime Minister" the only one who says Prime Minister Hale is Ralph (John Goodman) when he addresses the Parliament.
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