There is no bright line between the mundane and the magical, but most hobbits
act as if magic does not exist -- just as most modern-day people do.
Because Aragorn made the Shire off-limits to the Big Folk, the hobbits can
continue to live as if magic does not exist. But Merry and Pippin know
better.
On the other hand, Aragorn is no mere man, but the last of the Numenorean
kings, while Arwen is Elrond's daughter and Galadriel's granddaughter.
They may have chosen mortality, but they are essentially the queen and king of
Faerie. In several of his stories and poems Tolkien plays with the idea
of people from the mundane world visiting Faerie and even choosing to stay
there. In the stories of Beren and Turin and Tuor, those heroic men are
too altered by their experiences to fit into mundane human societies.
Instead, they marry elves and live with elves.
Sam and Merry and Pippin compromise. They marry hobbits and live in the
Shire. But eventually, when their wives pass away, they do leave the
Shire forever, Sam to the West, and Merry and Pippin to what remains of Faerie
in Middle-earth. It is a reminder that they are by no means ordinary
hobbits, but also that in Tolkien's view, a trip to Faerie carries a
price. After living in Faerie, the mundane world is never the same.
For those with eyes to see it, Merry and Pippin and Sam stand out in the Shire
like diamonds in a pile of coal. There is a certain amount of loneliness
for the diamond-like hobbit still living among his less-brilliant,
less-hardened kinsmen. Fortunately, Merry and Pippin and Sam have each
other, and do take trips outside the Shire. They lead happy lives, yet
how can the Shire compare with their
adventure?
“I dislike Allegory - the conscious and intentional allegory - yet any attempt to explain the purport of myth or fairytale must use allegorical language. (And, of course, the more 'life' a story has the more readily will it be susceptible of allegorical interpretations: while the better a deliberate allegory is made the more nearly will it be acceptable just as a story.)” (From Tolkien Letter # 131.)