Edward is saved from the street gang by Miles Hendon, who serves as a rather comical figure in the novel, even though he is very kind and his own story is quite tragic. From Twain's very first description of him, Hendon sounds like a man who was once something pretty special but is currently down on his luck. Therefore, it is easy to understand how he would sympathize with Edward's plight—and why he would choose to join forces with the street urchin who claimed to be royalty.
Indeed, Hendon acts as a father to the young, displaced Edward after he saves him. Moreover, he serves him as a faithful knight would his lord. It is not surprising, then, that once Prince Edward is restored to his rightful position, he bestows the real honor of knighthood upon his friend and protector.