All of the sources which describe Merlin are, unfortunately, from hundreds of years after the time when he would have lived (if he were a real person at all). This is true for Arthur as well: the nearest source we have to him is a mention of someone who 'was not Arthur' in a poem (the Y Gododdin) written sometime between the 7th-9th century (Arthur probably would have lived in the late 5th or 6th centuries - if he were a real person at all!).

As a consequence, it's kind of anybody's guess who the 'real' Merlin might have been. There are a lot of books that claim to describe the 'real' or the 'historical' Arthur, but sadly the evidence just isn't there to say any more than that Arthur may have been real, but we know nothing about who he was or what he did (see Guy Halsall, Worlds of Arthur, for a blow-by-blow demonstration of the total lack of reliable evidence for Arthur's life).

That said, what could have been true about Merlin, if he were a real person?

To the best of our knowledge, Druidism wasn't really a thing by the end of the Roman empire. The Romans were generally religiously tolerant, but they didn't like Druids - almost certainly because Druids were as much political leaders as they were religious mystics, and they got in the way of Roman attempts to subjugate the people they were conquering. As a consequence, Romans during the conquest did their best to stamp out the Druids, and pretty much all we know about them survives from a few very early Roman authors who describe Druids as something between community organizers and priests. By the end of the first century AD, Druids were probably not a significant part of Roman-conquered British society. 400 years later, any Druids that were still around would have been very far removed from the priest-leaders that the Romans encountered when they conquered Gaul and Britain.

Who could Merlin have been, then? Late Antiquity - the period surrounding the end of the Western Roman Empire - was full of holy men, hermits, mystics, and miracle workers. These men were, by the fifth century, generally 'Christian.' But the forms that their Christianity took were diverse, and many stood on the edge of - or outside entirely - the church structure. They also, in the fourth and fifth centuries, had a habit of showing up at the imperial court and chastising the emperor for various moral failings. It's very easy to imagine Merlin as one of these figures: a marginal, pseudo-Christian (or half pagan, depending how you look at it and who you asked) miracle worker who showed up to bring moral correction and spiritual aid to a local warlord. Such a figure certainly could have existed in early medieval Britain, and there's little doubt that the later stories of Merlin the wizard grew out of legends surrounding these kinds of marginal, holy, magical figures.