So I think the situation here is for small bands of elves, in the 30-60 range, to be formally organized by the army and sent to reinforce, say, middenheim's border patrols in an exchange for middenheim giving Laurelorn a few human soldiers to put right up against nordland and keep them from trying anything.
It gives the Laurelorn city elves a way to go wander the empire for a few years doing good deeds and see the world, basically. It gives Laurelorn a bit of a safety valve way of lessening pressure in the city, and ironically it puts the city elves out as a front line in front of the forest elves. Fighting to keep threats away from the forest to begin with might go a ways towards defusing tension with the wards.
Plus it gives a TON more person to person contacts for the elves and humans both, without exposing Laurelorn to trade caravans or visitors: the isolationists get to keep their isolation, the opener ones get their chance to make human friends and allies and bring in new things that strengthen the elves.
Best of all, I think this can be sold through Johann to the champion, and Mathilde to the vicereine and Prince we met. The champion would see the martial advantages of having more depth for defense and a way of renewing alliances with the mayflies, would take it to the queen. She would see the advantages of having a pressure valve for restless troublemakers in the city, without it looking like she was expelling them, and the political advantage with the forest born...
And we can potentially get an awesome unit of elf warriors as our kickass-if-less-than-before replacement for hammerer squad.