The accuracy of large-eddy simulations is limited, among others, by the quality of the subgrid parameterisation and the numerical contamination of the smaller retained flow structures. We review the effects of discretisation and modelling errors from two different perspectives. We first show that spatial discretisation induces its own filter and compare the dynamic importance of this numerical filter to the basic large-eddy filter. The spatial discretisation modifies the large-eddy closure problem as is expressed by the difference between the discrete 'numerical stress tensor' and the continuous 'turbulent stress tensor'. This difference consists of a high-pass contribution associated with the specific numerical filter. Several central differencing methods are analysed and the importance of the subgrid resolution is established. Second, we review a database approach to assess the total simulation error and its numerical and modelling contributions. The interaction between the different sources of error is shown to lead to their partial cancellation. From this analysis one may identify an 'optimal refinement strategy' for a given subgrid model, discretisation method and flow conditions, leading to minimal total simulation error at a given computational cost. We provide full detail for homogeneous decaying turbulence in a 'Smagorinsky fluid'. The optimal refinement strategy is compared with the error reduction that arises from grid refinement of the dynamic eddy-viscosity model. The main trends of the optimal refinement strategy as a function of resolution and Reynolds number are found to be adequately followed by the dynamic model. This yields significant error reduction upon grid refinement although at coarse resolutions significant error levels remain. To address this deficiency, a new successive inverse polynomial interpolation procedure is proposed with which the optimal Smagorinsky constant may be efficiently approximated at a given resolution. The computational overhead of this optimisation procedure is shown to be well justified in view of the achieved reduction of the error level relative to the 'no-model' and dynamic model predictions.