I think very few of the 80s fantasy flicks are really good. Conan The Barbarian and The Princess Bride are pretty much the only two I can really call great without significant flaws (okay, I really like Excalibur too. a truly amazing cast, and hey, like the Camelot tv series, the main problem seems casting a weakling as Arthur). That said, I have a soft spot for a lot of the others too:
Willow is a disappointing ripoff of Mozes, LotR and Star Wars, but with great roles by Val Kilmer, Joanna Whalley (the chemistry between them is great) and Jean Marsh is nice and hammy as Bavmorda. Also, some nice old school effects (the two headed dragon, some of the matte paintings, stop motion effects during the final wizard battle), nice scenery and a great soundtrack by Horner (though it's basically the same he used for Aliens/Star Trek II and Krull).
Krull, as mentioned by others, has a great weapon, some nice designs and another great soundtrack. Lysette Anthony was worthy of the rescue efforts!
Red Sonja was shit, with terrible acting, but a great Morricone soundtrack and some very nice matte paintings.
The Dark Crystal I loved when I was a kid, just as I did Labyrinth and The Neverending Story. it's easy to see the relative weakness of all three now, but I still like watching them on occasion, especially The Dark Crystal and Neverending Story. I wish someone would remake the Neverending Story and actually use the full book. it's a pretty great children's book.
Ronya the Robber's Daughter. a low budget swedish film adaptation of the classic children's book by Astrid Lindgren. gorgeous nature shots, great casting. I have no idea whether this available with english subs.
I'm gonna say that Flesh+Blood is also fantasy. I don't think there's any particular country or place mentioned that sets it in a real world, and it sure as hell fits in the sword and sandals genre, if not the sword and sorcery genre. Hauer is great, and everybody seems to be an utter bastard/bitch. the movie is a real who's who of the mid 80s dutch acting world as well, and has a great Basil Pouledouris score too.
Ladyhawke is also decent, again a great role by Hauer, even though everything about the style of the movie screams 80s.
Dragonslayer isn't a great movie, but has one of the best movie dragons ever, and I remember loving the whole christianity vs magic angle back then.
Jabberwocky. very weird movie (hey, it's Terry Gilliam, so that goes without saying), but I love it. hmm, Time Bandits (with its excellent model work on the whole fortress of evil bit) should go on the list as well. but that one would be in the actual great fantasy movies department.