Another point: to prevent enemy units (especially Elven ones) from moving too quickly, you can (and should) upgrade the "Sharp Mind" skill. Fortunately, a Demon only needs scouting for this. And that's it. Cast "Mass Slow" and I wouldn't want to be on the receiving end!
In short, you can effectively avoid spellcasting.
And in general, to win against the Elves, you need to somehow exert initiative and build up defense in some areas (I'm not just talking about the ability, but also about stats), and it would be good to get better upgrades to have more time to use "Berserk," "Inspire," etc.
In short, focus on magic and good defense. If you manage to get initiative, then you can confidently attack.