Thanks for linking this!
The full quote in which Tolkien expresses "dislike" for allegory (which the video's speaker alluded to near the end) was:
“I cordially dislike allegory in all its manifestations, and always have done so since I grew old and wary enough to detect its presence. I much prefer history – true or feigned– with its varied applicability to the thought and experience of readers. I think that many confuse applicability with allegory, but the one resides in the freedom of the reader, and the other in the purposed domination of the author.”
Both Tolkien and Lewis were very familiar with The Faerie Queene by Edmund Spenser (Lewis actually wrote a book about it), which is usually classified as "allegory" but which might better be called "feigned history," in Tolkien's phrase. As Tolkien writes about how Hobbits are still here (though difficult to find), and so we are still in the "feigned" world of Middle Earth, Spenser wrote that Faeryland could still be found, for those who wanted to seek it out. And in Faeryland, as in Middle Earth, even though (on a literal level) the inhabitants and events of that world seem flatly incompatible with ours, and even though the name of Jesus is never spoken, the work is unmistakably Christian in spirit.
