Right now the Elven factions start with generic buildings, and a poor economy that limits their amount of armies they can recruit. I assume this was set up so that Elves wouldn't field large forces and remained within the historical framework of a few elite units against innumerable odds.
The overarching principle of small but elite Elven armies is an excellent one, but the notion of Elven poverty also makes absolutely no sense. I suggest that we slightly alter the paradigm, and by the same token create an immense level of immersion for the Elven player.
My suggested paradigm is: Elves be given a large number of wealth and culture making buildings; but their recruitment pool be made smaller, only replenishing units after long and dutiful patience.
If this paradigm is implemented, what you will have is Elven factions awash in large amounts of cash, but unable to really recruit any further units (the opposite of what they have now, plenty of recruitable units if only the money was there).
If there is so much money with no good use to put it to, what will Elves do with all that cash? That's where we bring a new level of immersion in: a whole host of artistic and cultural buildings which will be available to Elves only, and which will cost preposterous amounts of money to construct. As examples of the kinds of buildings you could have, dig deep into LOTR lore, culture, and poetry:
A Historian's Workshop (where elven scribes record the latest wars and world events)
....(+small amount of income, from new incomers coming in to read what your scribes have composed)
Poetry Circle (elves gather here to have poetry contests)
....(+small amount to settlement happiness)
Lore-Keeper's Retreat (where scribes study the ancient lore, and scholars maintain the Silmarillion, philologically comparing manuscripts to only allow the best copies and transmissions)
....(+etc...)
Archery Circle (where archers compete in games and competitions)
....(+archery experience)
All of these could cost preposterous amounts of money, and Elves would be able to afford every one of them, since they would have nothing else to spend money on, certainly not on the military (where new units still haven't appeared for recruitment).
Then, when you now have these buildings as part of the Elven faction, you could take it further and have scripted competitions for your Elves to take part in. A message could pop up saying:
"Would you like to host a song and poetry competition? 20k gold." Sure, you press ok.
"Would you like to host an archery competition? 45k gold." Sure, easily affordable for you.
"Would you like to invite humans to the competition?" If so, nearby human provinces could gain a +1 experience for their archery units.
"Would you like to teach nearby human settlements the art of history? 10k gold." If so, a nearby human settlement would have a "Human Historian's Workshop" appear, a weaker watered-down version of the building you have in your settlements. In this way you could sit in the woods and spend money on culture, or raise the human people's culture to aid them in fighting against the Shadow.






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