Lol, well Will since you asked...
No, I think there will not be much solving with words - a full out fight it can be, and yes, you can 'cut them' a little bit
Just one condition:
Please do not kill any of the elves. They are only NPCs, but for the sake of realism and sticking to Tolkien by not starting an elf-dwarf war which Tolkien somehow didn't mention (and which would probably have severely got in the way of Gimli and Legolas's friendship), please do not kill any of the elves. Bruises, cuts, maybe a broken limb or two - but no deaths please. And it goes without saying that without the owner's permission there will be no dwarven deaths - those will come later *evil*
Whether the elves manage to catch the dwarves and bring them to Thranduil or whether they get away by fleeing, yelling catcalls behind them, is up to you lot and how the game pans out - personally, I'd go for number two, what do you all think?
Perky Ent, where are you? Please, do post, as after two weeks your character may be considered unplayed and dealt with accordingly.