Try it.

There have been atleast two prominent elf paladins recently, one is now a heroimm, the other is leading a cabal. I think we can assume that it's a viable option, though how well it works for you is... up to you. Besides, there is more to a succesful character than how strong they are in pks. If you have a good role idea for an elven paladin, you should be able to make it succesful despite any weaknesses.

Ofcourse, no matter what you do it wont be half as good as a dwarf paladin! Fargin' elves...

Rog