So it turns out the elves were less than truthful. Apparently, the Yuan-Ti have actually defeated the Elves, mostly because they were able to magically age the Elven King, and seal the cave which contained the cure to all who dwelled in the Elven City of Yarauna. Using the gold collected from the party to purchase magical items, the Elven King, Arch Mage and High Priestess bribed the Yuan-Ti "diplomat" that was at the party to get the location of the cave, then transformed themselves into magical items, powered by their essences, which they had presented to the party as the items they had purchased. This allowed them to bypass the wards which prevented them from entering The Clockwork Cave. After fighting their way through the cave, defeating the Time Dragon at the Heart of the Cave, and two of their party being aged significantly, the elves revealed their deception, and offered a reward for the party's service, explaining that the could not reveal the truth of things before because of the presence of the Yuan-Ti hidden throughout the city, who were monitoring them for signs of treachery.
Now, at this point, I expected the party to be... upset. They had been running around with Gauntlets of Ogre Power, a Long Bow of Accuracy and a magic axe that returned after it was thrown, all of which a) they had paid for, and b) they no longer owned. In addition, it turned out that the Limited Resurrection spell hadn't been limited at all, the Elves had just told them that to get them to brave the Cave. But, as I said, the elves were genuinely regretful of the damage they had caused the party and offered a reward.
I expected them to be upset, I expected them to fuss.
I didn't expect them to try and kill the King of the Elves.
They didn't ask what the reward was, no, one of the party (who in fairness, had doubled in age since they entered the cave) simply leapt at the King and attempted to stab him. The Elves teleported away, leaving the party to mutter angrily and plan a campaign of asymmetrical warfare against the Elves. They have considered burning down the city, choking it with animated vegetation, even joining the Yuan-Ti. Which is funny, considering they're still wandering around with a bag full of Yuan-Ti heads strapped to their belt - I'm not sure how the Yuan-Ti will take their offer of comraderie.