Walt,
Understand where you are going with the track. It sets a good mood for your description above. Not knowing what the game is, or whether there are any suspenseful moments, makes it difficult to fully assess how the track will fit in the game. I think the only thing lacking in the piece is suspense, which may not be necessary. It definitely fits your description of "use in a lush forested area containing mystical elf-like creatures"
For better or worse, the trend for musical themes for backgrounds seems to be high-energy, suspenseful, sound effect laden, themes. If that is the case, you could always add in some NI Damage to your current track to add a bit more of that suspense mojo...... I like the piece as is though and think you have done a fine job with it.
Regards