Haha that's a good idea, I like the way you're thinking.
There are certainly rival states out there, but I need to balance the scope of the story as well, too many things going on at once could get really confusing for the reader. Even the President of Syl'anar hasn't been shown yet, though he will.
The reason for much of this is because this story focuses on the daily lives and perspectives of people living in a nation like this. While global geopolitics would be fun for me, I think it would make things a bit too messy.
I am currently writing a story involving the first crusaders to land in Syl'anar, which will give a lot of insight to geopolitics of the world at the time and how things lead to here. Right now I'm thinking that the Old World was very similar to the Holy Roman Empire. That being a collection of smaller states with a loose union between them. Nothing on the scale of modern nations or even France back then, and were mostly only unified under Gaianism. Because of this, a single state never truly rose above the rest to dominate the region. But as Syl'anar was colonized, they eventually formed states, which unionized under the nation of Syl'anar, which became the world's only hegemon like you mentioned. Truly nothing compares to them, even in our own world. Syl'anar is about the size of the whole continent of Africa, with far more people and resources as well.
You're right that some elves must have slipped through the cracks at some point, likely before the ban on elvish emigration. As rare as it would have been, there are certainly some elves outside of Syl'anar. But Syl'anar sort of treats them in the same way China treats their Pandas (with a very tight leash). Any other country protecting elves would be heavily sanctioned by Syl'anar, and they would eventually cease to exist.