Elves are an interesting concept - insofar as they are creations of a human mindset. And varying in substance over the centuries.
We have the elf of Tolkien’s universe, as such dogma to the D&D universe, but actually very different. Because Tolkien’s elves do not age and die like D&D elves do. Their fate is tied to that of the world of Middle Earth.
They are beings of great power and importance, but not necessarily noble. Indeed they are prone to corruption on equal measure - or even more so - as humans. Signified by Morgoth’s ability to warp them into the worlds darkest and most destructive enemy - the orks.
On the opposite scale as this we have the elves of Earthly mythology, Shakespearan for example, beings of complete nature. Take my own Scandinavian myths for example, elves are described as beings of an almost esoteric nature, whom lost men come upon in the middle of the night dancing around a great hill lifted up “on glowing pillars”. They are of an unearthly beauty, but their backs are hollow and their danger to mortal men is terrible.
Under their spell you may dissappear from this world, never to be seen again. You may awaken after their nightly revel and a decade has gone by.
Somewhere in between these two lie your classical D&D elf - whereas I consider the Cerilian elf to be rather closer to the second example than the first.
Tolkien uses the elf to portray all the paramount virtues of men - as well as their worst vices (consider the carefully planned nobility of Lord Elrond, Sauron’s constant enemy, compared to the greed of Prince Thranduil who ends up fighting Sauron’s servants in Mirkwood, but also wants his share of dragon gold - and is willing to take it by force.)
And the mythical elf could be interpreted as a warning to men: “Do not go out into the forest and dance with the strange women there. They are hollow of back and will draw you away from your natural world.” As such a tale serving the stable society.
Now where am I going with all this? Well, good question. I believe the elf to be much more a portrayal of a hidden human longing. They are of an eternal quality, in perfect tune with nature and blessed with anything between eternal and extremely long life. They should as such be much better endowed than humans to function in a complex and unrelenting world.
That you, Rugor, can surmise that their longevity leads them to “understand death far better than any mortal”, I consider an example of the above.
How beings by nature far removed from death, should have a greater understanding of it than humans, who are by nature inadvertently tied to death, seems strange to me. Humans know death, see it every day and has to accept it’s inevitability. Humans are trained in death, not because of an ability “to die in the service of their god(s).”, but because die we must. Death is our curse or blessing, depending on how you view it.
The Cerilian elves on the other hand, caught between the Tolkienesque, mythological and classical D&D elf, are cursed or blessed to life. You could take this to mean a slowly perfection of wisdom and intelligence, let them assume the position of greater ability, of sublime existence. Or you could consider them a society hopelessly stymied by a slower than snail-pace changing culture, traditions and hence political ability to react to change. Perfect conservatism…
The Cerilian elves certainly embody the second - as they have denied even the possibility of there being gods! Even as they were relentlessly pushed back on all fronts, by god-fearing humans and ever-multiplying goblins.
But the first aspect could just as well be the reason for their slow retreat. Because it is certainly not impossible that the elves are there in the service of a higher purpose - a purpose that Isaelie and Fhilaerene know and perhaps disagree on, but Rhuobhe certainly does not understand (being corrupted by the essence of a dark god of humanity.)
That all really depends on how mythical a world you want? Are the elves in service of the Tolkienesque stewards of the world - the Ainur. Or are they more a natural force opposing the relentless civilizatory “corruption” of men.
Consider this question: How did Azrai lure the elves over to his side?