Did the Fellowship understand Gandalf's confrontation of the Balrog?

Question

With reference to this clip, Gandalf revealed his identity to the Balrog and fended him off with his own powers. Considering that, as Istari, he usually made sure not to reveal his true nature to anyone, did anyone in the Fellowship understand the true significance of what is revealed to them as they watched and heard Gandalf standing up to the Balrog?

Edit: Also, when Gimli and Legolas bowed before Gandalf the White in that clip, what is the reason? Did they bow because he is Gandalf, or is it because, as I asked, they have realised what he is?

Answer 1

This is never answered explicitly, but for the most part it seems stunningly unlikely. From this answer to a related question, Gandalf explicitly identifies three elements as part of his threat; there's little to no reason to suspect that most members of the Fellowship would understand their significance:

1. The Secret Fire is an important element in the Elvish creation myth, but it's not entirely clear how widely-known that story is:

• Legolas and Aragorn probably would have understood it. Legolas because he was raised by Elves (though not High Elves, so it's possible he wouldn't have known); Aragorn because he was raised by Elves and Dúnedain.

• Boromir might have; reverence of the West appears to be common in Gondor:

  Before they ate, Faramir and all his men turned and faced west in a moment of silence. Faramir signed to Frodo and Sam that they should do likewise.

  'So we always do.' he said, as they sat down: 'we look towards Númenor that was, and beyond to Elvenhome that is, and to that which is beyond Elvenhome and will ever be. Have you no such custom at meat?'

  ^{The Two Towers Book IV Chapter 5: "The Window to the West"}

• Gimli maybe would have, but it seems unlikely to me. The Dwarves didn't worship Ilúvatar, but their creator, the Vala Aulë; it seems unlikely that most Dwarves were taught about Elvish theology, considering the mistrust between those peoples.

• Merry and Pippin almost certainly didn't. Hobbits don't generally practice religion, and these two aren't (currently) the most studious of hobbits.

• Frodo and Sam possibly would have, but it's not clear. They both had an interest in Elvish lore, but whether they took the time to study the theological aspects is unknown.

2. The Flame of Anor was probably better-understood by most of the Fellowship, since "Anor" is just the Sindarin word for "the Sun." But this line alone doesn't indicate that Gandalf has any relation to the Undying Lands; in a certain sense it's poetical (the Fire that creates versus the Fire that destroys), and may have been interpreted that way

3. Flame of Udûn is again probably not understood except by those of the Fellowship who know their ancient Elvish history; but this is a reference to the Balrog, not to Gandalf, so doesn't factor into this question.

Whether you think any among the Fellowship took the hint over what Gandalf is really depends on if you think they understood the reference to "the Secret Fire," but even that isn't unambiguous evidence that he's an embodied Maia; the most it says explicitly is "I am aligned with Eru Ilúvatar."