"I am sorry about Merry. If it helps, I doubt he felt much."
Ah...that quote right there absolutely nailed for me this whole story. Everything's gone to hell in a handbasket and the best that could be said is that those who are dead, died quickly. And yet, the context around it implies hope to go on, even if only out of sheer stubbornness. Anyway...
This chapter, to me, is basically here for the same reason as "Baggage", though I think it works out much better. Good use of a running internal dialogue to show off Pippin's thoughts as he tries to make his decision of which way to go. I also like that you didn't make the obvious (story-telling wise) decision to have Pippin do the "heroic thing" and ride to the Black Gate. I really should've seen it coming, but when he finally announced that he was going home, I was taken by surprise. I think it's a mark of how well you set up the announcement and how much Pippin has matured in these chapters. He's always been maturing but, as you noted, Pelennor Fields (or more likely, Merry's funeral) was what caused everything to solidify.
Good use of Rohiric. It added a nice touch of authenticity when you bothered to actually give us what was said in the ritual rather than simply let us see Pippin's wandering thoughts. Theoden once again singing was a very nice touch...it seems appropriate that the old man should sing.
While I didn't start commenting until recently, I think you've always done a good job of integrating different facts, events, personalities, etc. to make up your plot points. This chapter is a great example of that. The funeral alone has you pulling crap from two separate sources and other bits, such as the state of the City's two out circles, are also good examples of how you've taken what was already mentioned and adapted to work within what you already have.
Yay, someone finally managed to get through "I-Want-To-Be-A-Perfect-Blond-Killing-Machine"'s head. It was a good time to finally reveal to Legolas just how jacked up he was getting and Pippin had finally come to the point where he could do it. It'll be interesting to see how, or even if, he comes out of his funk. Maybe he and Eowyn can go brood together. Heh, they're such a happy couple.
Hmm, Baggage may have rubbed me the wrong way, but I honestly can't find anything to actually harp on. I would like to see Denethor come into his own though...he's portrayed solely as the insane fool so often that I really wish we would get a chance to see just how smart this guy is. After all, he's lost his chance to play the human torch, so what else does he have to do :D
Good stuff all around, sorry I can't actually offer any actual writing advice...might be because I'm so tired of working on some Fire Emblem fanfics that my mind can no longer comprehend writing.