Medieval elves have always struck me as being somewhat closer to our contemporary idea of fairies: small, mischievous little sprites, with just a bit more of a dangerous edge. Tinkerbell might betray you to Captain Hook, but medieval elves could shoot you and your livestock with invisible arrows that would make you sick, perhaps even mortally ill.
In that way, I don't think medieval elves occupied the position of "other" in the sense of being non/human.* There were "others" in the medieval mind -- for example, trolls in Scandinavian folklore often seem very nearly human, and certain kinds of fairies (the kind that look more like The Fairy-Queen or Midsummer Night's Dream fairies), as well as all those weird foreign tribes who are cynephalous or acephalous or scatocephalous.** Instead, they are a way of labelling the unknown.
Being "elfshot," which sounds ridiculous to the modern mind, is strikingly similar to the ideas that you and I hold to. "What? Invisible flying elves shoot you with invisible darts that you cannot even feel, and you become ill? Preposterous! Everyone knows that invisible flying creatures called germs and viruses, that you cannot even feel, enter your body and you become ill!"
How many times have we gone to see a physician about an ailment, and we are told "it's some kind of bug going around -- here, I'll prescribe you an antibiotic." Throwing antibiotics at patients is another way of saying that we don't know what is causing the illness, but it's probably some kind of bacteria. Ditto for a lot of other ailments. One problem with studying Latin is that you'll hear from your physician that you have something with a Latin name, and you realize from that Latin name that they don't know what's causing it either.
So, we throw a Latin tag on it, we label it "viral" or "bacterial" or whatnot, and we call it a day. As many times as not, this is really our way of saying that illness is caused by a variety of invisible things, and it could be any one of them. Elves and fairies occupy the same space, I think. Unlike witchcraft, which suggests a malevolent human agent, elves are fairies are just part of the natural world. When we same someone is "elfshot," we are saying that an illness is caused by one of any number of invisible things, and it could be any of them.
What about the other kinds of elves, trolls, and fae, the big ones? The ones who are "others," and nearly human, occupy a more malevolent (or at least alien) intelligence in the world. I use the word "alien" intentionally, because aliens (the outerspace, abducting kind) work in the same way for our culture. If Fox Mulder had lived a millennium earlier, he'd have been an Inquisitor, looking into claims that children had been abducted by fairies, or were perhaps changlings. Indeed, our "alien/human hybrid" of science fiction is just another version of the changling.
We haven't really changed much at all. Elves, fairies, changlings or viruses, bacteria and aliens -- in many ways we still occupy the same mental geographical landscape, we've just changed the names of some of the more prominent features.
** OK, I made that last one up, but I know some people like that.