Elites are always seen as too hard when they come out. Once people get to know the strats, people gear up, etc. they get easier. This isn't just Arcane Legends - but any MMO that I've played. You guys will be farming this stuff soon. If you're put off by deaths, then take it easy. It's all good.
As for some of the questions:
Dragkin Teeth still drop from normal bosses. They drop more frequently from Elite bosses.
Bale, Krunch and the Shuyal Gladiator Arena are not scaled up to 41. That may come in the future.
As for farming teeth, there is a whole lot of stuff you can get with them, so it seems like a pretty worthwhile endeavor to me!
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