Entering Arkham Asylum, Bruce finds all the guards dressed up like either himself or the Joker, in deathtraps, that he quickly gets them out of, to Joker's applause. Believing Joker must be holed up in Jeremiah Arkham's personal quarters, Bruce begins what could possibly be a death march to confront his oldest foe.
On Bruce's way to Joker, he's met with many, shall we say, "royal" obstacles. First a gang of his "knights" common thugs and inmates, dressed in riot gear, who all gang up on him. Though he struggles a bit, he comes out victorious in the end.
Next is the royal tapestry, constructed by the Dollmaker, out of countless (still alive) bodies, sewn together, with art depicting some of Batman and Joker's greatest hits. Laughing Fish, Death in the Family, and what I believe to be the part in No Man's Land with the infants...
Next, Bruce is confronted by his castle's "groundskeeper," Mr. Freeze, who manages to shatter his horse's head... Oh yeah, Bruce was on a horse... Forgot that. Bruce, being in no mood to play, easily gets past Freeze, placing a heating device on his suit, incapacitating him.
Bruce is then confronted by his "Royal player" Clayface, and his physician, Scarecrow, both of which he dispatches of, just as easily.
Bruce finally makes it to Arkham's quarters, where he finds his royal court, consisting of Joker (jester), Penguin (man of the cloth), Riddler (strategist), Two Face (judge) and a couple of saps dressed up like his subjects, the Justice League. Joker goes on to tell Bruce that he is his Jester, and could have served anyone, like the King of Metropolis, Superman, forcing the guy dressed as such to pull the electrified sword (chainsaw) from the stone, killing him. Before Joker forces the "Amazon Queen" to do the same, Bruce manages to break into the room, but not before a giant metal gate falls upon them.
Joker has a little surprise for Bruce, showing on a video screen the images of all his defeated allies, and warns his king that if he doesn't sit on his throne, he'll never find a single trace of any of them, and forced to live out his life wondering what happened to them. Seemingly proving Joker's point, fearing for his family's life, Bruce is forced to comply, sitting upon an electric chair, and getting shocked, knocking him out.
In the backup, the royal court inspects Batman's body, as Two-Face suggests they flip his coin on whether or not to shoot him, just to make sure he's dead. Joker has nothing of it, and basically tells the three of them to screw off, as their part is done, locking them behind him and Batman.
Penguin tries to get Riddler to figure out a way out of the cage, but Joker ended up lacing Riddler's clothing with drugs, knocking him out. Two-Face becomes infuriated, pointing his gun at Joker, who isn't the least bit threatened. Joker begins to tell Harvey how pathetic he believes him to be, asking him how he knows he didn't drug his suit to, or give him a gun that fires bullets backwards. Holding Harvey's gun to his head, Joker even mocks his soon to be made decision not to pull the trigger, as he'd pretend to have let the good side take over.
But, not to leave his willing players out to dry completely, Joker shows them both what he has on his platter, to which Two-Face says "You have to be joking," the word play not being lost on Joker.