Answer: D) A hand comes out of the lake to grab King Arthur’s sword.
Explanation: A supernatural event is a situation or a thing that can't be explained by nature or science, and are assumed to originate from otherworldly forces. From the given situations from "Morte d'Arthur by Sir Thomas Malory", the one that represents an example of a supernatural event is the corresponding to option D: A hand comes out of the lake to grab King Arthur’s sword, because it seems that it doesn't have a logical explanation in nature or science.
The word "while" is what makes the sentence a fragment, and substituting it with "when" would not correct it. The correct answer is B. delete "while" so that the sentence is: "She was making a pot of soup."