From Wikipedia http://en.wikipedia.org/wiki/Faggot_(food)
A faggot is a kind of meatball, a traditional dish in the UK, especially the southwest of England, Wales, and the Black Country. It is made from unwanted meat off-cuts and offal, especially pork. A faggot is traditionally made from pig heart, liver and fatty belly meat or bacon minced together, with herbs added for flavouring and sometimes breadcrumbs. The mixture is shaped in the hand into balls, wrapped round with "caul" (a membrane from the pig's abdomen), and baked.

A more concise definition from Oxford University Press http://www.oup.com
(BrE) a ball of finely chopped meat mixed with bread, baked or fried and eaten hot

And the original source from 1851 (OED), to be found on http://dictionary.oed.com
5. (See quot. 1851.)
1851 MAYHEW Lond. Labour II. 227 He..made his supper..on ‘fagots’. This preparation..is a sort of cake, roll or ball..made of chopped liver and lights, mixed with gravy, and wrapped in pieces of pig's caul. 1858 SALA Journ. due North 308 The curious viands known in cheap pork-butchery..as Faggots. 1881 in Oxford Gloss. Supp.

Generally, I don't think that each local traditional meal has to be included in a dictionary, but due to the totally different use the word "faggot" sees nowadays, it might be helpful to include it.
BTW, I reckon this use is not really "obsolete", as (see Wikipedia) the traditional dish is still served today and even industrially produced by the company "Mr Brains".

Apart from "faggot" or "faggots" the dish is also sometimes called "Savoury Ducks" or "Yorkshire Ducks" indicating their origin. I didn't find any "official" sources for that, but many cooking guides using these terms, like:
http://www.blunham.demon.co.uk/Yorksgen/Recip...
http://www.buryblackpuddings.co.uk/catalogue....

Well, if you don't think this use of faggot is worthy to be included in LEO, I hope you at least found this to be a bit entertaining.

Cheers
Jens