Start at the Royal Stable Master

Royal Stable Master says, "I see you have an Arboreal Horse voucher there. If you're one for wild goose chases, I won't stop you."

Royal Stable Master says, "I say that Horses can't be trees. They're obviously different kinds of things. Yer average horse having four feet and being fairly mobile, yer average tree having one trunk, and being a little lacking in the movin-around department. However, before I got this job I would have said they couldn't be storms, or on fire, so shows [what I know]."

Royal Stable Master says, "I certainly won't tell you not to try. If there's anywhere they'd be, it'd be out in the Shrouded Isles. I've heard some rumors of weird horses in The Dales of Dewvy, near Fort Gwyntell. Talk to Kirynn, but I wouldn't get my hopes up if I were you."

Travel to Fort Gwyntell. Kirynn is just outside the fort...

Kirynn says, "I have [seen] them! I promise I have!"

Kirynn says, "A horse that was like a tree. I've seen it several times... once near here, but most often near the river, on this side. They seem to shy away from all the poor broken-down houses and constructs of men. But I have seen them I [swear] it."

Kirynn says, "It was a horse like a tree, with dark skin like bark. I've never been able to get close enough to touch one, but I know they are out there, waiting for someone to find them."

I found an Arboreal Horse at 52k, 28k in the Dales of Dewvy, between Fort Gwyntell and the Village of the Damned, south of the river. The horse was clearly moving about some, so you may have to look around to find it. Once you find the horse, simply walk up to it and right-click it - you will receive a leaf from its mane. Return to Kirynn...

Kirynn says, "You're back! And you found one? I told you didn't I? oh, please show me that [leaf]!"

Kirynn says, "Is this from the horse? I used to make whistles out of these kind of leaves, when I was younger. Here, I'll make you one now. Who knows what will happen when you use it!"

Kirynn will give you a Leaf Whistle. /use the Leaf Whistle, and you will receive the Arboreal Horse.