Sharpur, it never said that the elephant was carrying the palanquin. It just said she was on an elephant's back. So, obviously, the titular character rides on the back of the elephant, and the elephant is riding on the palanquin, which is carried by humans, and the humans are carried by the earth, which is carried by a giant turtle whose gender is unknown. This is why it's a palanquin and not a howdah. Obviously.
As said by Cobra-65, I heard this song and found The Decemberists through Mad Men. I now own most of all their albums. One of my favourite recently discovered bands, although the missus doesn't get them. Power to them all, love ya!
I discovered this band via "Mad Men". They featured it at the end of one of their typically amazing episodes, Season 2 I think, and I remember thinking, "Wow, what an incredible song!" I never heard anything like it before or since.