I am GMing for a group of ex-College friends, who are quite new to role-playing (six month or so), in a custom universe using a lot of characters inspired by Arthurian legends, including the sorcerer Merlin and the sword Excalibur.
The system is home made, based on comp+d20 for rolls, with a strong emphasis on role playing (most actions do not require rolls). The players have to act under some level of uncertainty: they are not fully aware of the consequences of their acts when they accomplish them, but have some knowledge of the legends/stories, giving them hints. I am not looking for system-specific answers.
Merlin will ask the players to retrieve Excalibur1 from the castle Camelot, because he believes the rulers are now corrupt, and are not worthy of the sword any more. However he will not do it himself, since he does not want the inhabitants of the castle to turn against him, and he wants them to feel like they have been punished by God.
The players will be asked to either plant Excalibur into the Rock where Arthur first lifted it or to throw it into the Lake. If they complete the task, they will be worthy and will have a chance to receive the sword from the Lady or to take it again from the Rock. However, they probably will try to steal the sword and keep it for themselves. That would make them unworthy of the sword.
I do not want to players to feel like I cheated them, and I only showed them a great piece of loot to deny them. The group has a strong interest in loot overall.
How can I make it non-frustrating that stealing Excalibur, instead of returning it to the Rock/Lake, will not allow them to use it to its full power, or will even have negative impact on the group's performance?
1: Note that "The players found a fake version of Excalibur" would not work for plot reasons.
Best Answer
In general, the best way is for greedy PCs not to get the loot in the first place thus side stepping the whole problem.
Despite the terrible pun (or nettle Eggcorn?):
However, in this case, it is a great role playing opportunity!
Your player characters have a chance to turn evil or good based on their actions. As the GM, you should lay out to them the choices: be worthy knights or dastardly thieves. Then, let the players make the choice and live with its consequences. If they choose evil by greed and foolishness, this can lead to a great redemption plot as they face the horrors of what they have done and seek to repair them: The King is the Land, a Land without a King (no sword, right?) tarnishes. This roots the King/Land/Sword into Arthurian Legends.
Regardless of the system used, Excalibur should be a sword without stats. No one defines what it does but itself. It should not be reduced to a simple "+5 to hit"… The more unworthy of the sword they are, the more the sword loses its abilities and might even inflict harm onto its wielder. And the more worthy the knight holding it, the more powerful a weapon it can be. Or maybe its powers do not lie in attack and defence but are more subtle?
Do you remember Murphy's laws? The main one being "if anything can go wrong, it will". Maybe Excalibur's main power is to enforce this either for the worthy wielder's enemies or for the dastardly unworthy handling it. When in the hand of a worthy person, Excalibur makes their life easier: everything is easier, luck always on one's side, happy coincidences abound. Whereas, if handled by an unworthy one, the reverse is true: wounds fester, food tastes like ash, drinks do not quench thirst, unhappy meetings happen… It is subtle, insidious, and mysterious: just what a magic sword should be.