These lines are full of visual and aural imagery. One imagines the glittering jewels in the horse's bridle and the sound the bridle bells make in the silent forest. The comparison to the "Golden Galaxy" reminds the reader that the Lady of Shalott is hidden away and remote, far from consideration and awareness of the wide world at large, and unable to go outside to look at the night sky as most people can.
This is also a very important line because it describes the spectacle of Lancelot's horse, and the distraction it represents for the Lady of Shalott. Because she notices his beauty, and the beauty of the horse, bedecked in jewels and bells, she is cursed. She sees the appeal of the outside world, and is entranced by the possibility of love, and is destroyed by it. This is a powerful commentary on the power and tragedy of romantic love, which explains why the poem's popularity has endured.