So, will the elf be sitting in the crown of a living tree?

Exactly. It could be an archer who fires from behind the branches. A mobile firing point. The branches will provide cover, and there will be a firing slit between them. Or he could simply sit on his shoulder and shoot, or stand in the crown, with a wooden head.
You could put a mage there, and even better - a warrior. A warrior with a polished spear, for example, so that he has a bonus for running and can reach from the branches, or better yet, with two swords. The wooden creature wraps around and tanks, and the elf creates a bloodbath.
In my opinion, this idea is no worse than the idea of riding a deer or a rabbit.

And the word "left" in the meaning of "outsider" also cannot be used.

Lol, okay, as you say.