merlin absolutely could've had lgbtq+ rep. the only problem was that the writers hated anyone that wasn't a cishet white man. the way they wrote characters showed that. that is the reason why there's no rep, I don't think it was because of the time.

for comparison, doctor who included jack in the first season in 2005, 3 years before merlin even started. it's very clear he's not straight in the first episode he's in. that's also a bbc show, so it's not an issue with the time or the channel. it's the writers.

lgbtq+ people have always existed, it's not unrealistic to include them in movies/shows no matter the time period. the writers could've so easily included a non cishet character, even in passing, but they made the decision not to. they hate everyone who's not a cishet white man.