Just because someone made a nasty Goblin Fortress once, doesn't mean that you can't do it right.
As for elves, here's an idea... Since they clearly have tons of wood, but it would be hypocritical for them to actually be chopping trees down (especially since they'd have to do it even more than dwarves, since wood is their only building material)... give them a special workshop that lets them produce wood logs at a steady pace for free.
Or, perhaps, give them access to one or more farmable 'wood plants' that can then be converted into actual wood logs at the workshop (by making the wood plants differentiated and biome-dependent, you could also connect the Elf game to the natural biome that they embark in, which seems very elfy, in the same way that Dwarves have to pay close attention to what they'll find underground). You could say they use nature magic to create wood that 'wants' to be shaped.
I just can't picture elves actually clearing out forest space to build stuff, y'know? Also it makes them even more elfishly annoying, since it implies that they won't share their secret of free wood-production with other races but still consider them barbarians for getting wood in the only way they are able to.