Thanks everyone for all of the ideas. I was and still am pro-fertilizer and went with that method of dealing with the remains. I was planning on the sapling idea, but wasn't sure if others thought elves would bury their dead. Thanks for the affirmation. They held a beautiful ceremony, beginning with a procession to the Spirit Grove/Grove of Ancestors. Every Elf who knew Nym told sang or recited his life from birth to death, ending with his sister, since she was there just before his death. The Druids of the village bore the body forward under a white cloth past all of the Elves in their white cloth raiments, except Shea, who wore a raiment in accordance with his worship of Corellan, with holy symbol displayed.
Nym's remains were brought forward by the Druids into the sacred grove and he was placed in a shallow depression in the earth. The Heirophant of the order came forward and presided over the placement of a sapling grown from the village's Tree of Life over the grave. The tree is watered and magic is used to root it to the body and begin to grow. It is named Nym's Tree.
At that point, every Elf present steps forward one at a time before leaving and places something at the foot of the tree that was special to Nym. Some of these will be removed by the Druids at sunset the next day. The Elves sing Nym's spirit into unity with the earth as the tokens are placed. They include a chess piece, hair ribbons (placed by Aria and woven around the sapling), his favorite food, his favorite flowers and sprigs of plants important to him, the quill pen he used to write in his spell books (placed by his teacher) and finally Shea placed his holy symbol of Corellan Larethian in on the sapling. The last of the elves move away as dawn breaks, signalling a new day and the beginning of the next phase of mourning (more of a remembrance of the sanctity of Nym's life and any elven life), which will last a year. His brother and sister and parents are given tokens with Nym's hair woven with plants to wear in remembrance. The family comes together and goes spends a full day in silence at home, then that night, there is a feast with the extended family.
For music, I thought the Grieg didn't sound exotic enough to be elven, so I used a Celtic piece called "The Three Graces." It was a moving experience. Nym/Shea's player told me I must have had too much time to plan this (as he removed his glasses and wiped his eyes). Beautiful. Thanks everyone!!!
DM