Or, thou art a thorn in my side…
Back in colonial times, if you had asked a stranger for directions to "ye olde candle shoppe", you probably would have been bundled off to the nearest insane asylum (and they were
nasty places back then, combination of warehouse for the crazies, snake pit, and entertainment for people who couldn't afford to go to the theater). Adding an extra "e" to "old" and "shop" is a modern affectation, but what about "ye"?
Well, there
was a word "ye", but it really had not much to do with the definite article "the". Then why do people write (and say) "ye this or that"? Because a thorn can look like a "y", that's why. Huh? A
thorn, in this case, is the archaic English letter Þ (uppercase) and þ (lowercase), still used in the Icelandic language. You mean that's not a cross between a P and a narwhal? Nope. It's an old Norse letter (one of several) which has since vanished from English. It had the sound "th" (today we write the digraph
th for that sound).
Now, the cursive (handwritten) form of thorn looks a lot like the Latin "y". See the picture below, which looks like a "y" with an "e" floating above it. That's one form of thorn (plus an "e"). Several words were formed in such a manner:
that (thorn with "t"),
thou (thorn with "u" or "ou"), and
the (thorn with "e"), and perhaps others. The first printing presses in England were imported from Germany or France, who did not have Þ and þ in their type collections. The nearest thing that a printer could come up with for a thorn lookalike was a "y". Also, due to the limitations of movable type, the "e" (or "t" or "u"/"ou") migrated off a bit to the side, as something of a superscript: y
e. Eventually, it floated down to Earth (or at least, to the baseline) as "ye". It was still pronounced "the"! So, the next time you visit Boston, or Plimoth Plantation, or Sturbridge Village, or Jamestown, or Colonial Williamsburg; just roll your eyes and sigh when some says "yee" when meaning "the".

How about the other meaning of "ye" (the one pronounced "yee")? Apparently this one has been around European languages (including English) for a long time, and its spelling and pronunciation have not changed. While
thou (thorn + "u" or "ou") and its various declensions
thee, thy, and
thine were used as an informal or intimate (even impolite) form of address (always singular),
ye, you, your, and
yours were used to address more than one person, or to address a social superior. Oddly, this was sometimes reversed in religious texts, in keeping with the Hebrew forms of address.
Maybe some day we'll discuss some of the other letters that like Þ/þ have disappeared from English but live on in some other European languages: Ð/ð, Æ/æ, Œ/œ, Ƿ/ƿ, and maybe some others.
http://www.dictionary.com/e/letters-alphabet/Some interesting reads:P.S. Is "the" pronounced "thee" (long e: ē) or "thuh" (schwa: ə)? Either way seems to be fine, dear. I myself will pronounce it both ways in one sentence. It seems to depend on what the initial sound of the next (upcoming) word is, and whether a long e or a schwa will require less mouth, tongue, and lip movement to get to that sound. I think. It seems to work that way for me.
Grammar Girl spells it out more specifically, with a rule similar to
a versus
an:
Pronounce it “thee” if the next word starts with a vowel sound.
Pronounce it “thuh” if the next word starts with a consonant sound.
…although I don't know for sure if this is what I've ended up doing simply by what sounds better to me. It's interesting if this can be reduced to a hard and fast rule, although cases such as, "The colonists burned thuh effigy of King George," seem kind of borderline.