here is what i think :
1) to answer your question, to look more realistic, the mountains are whats going to have to be reflected, not the hill. Either way it is to hard to reflect the hill.
2) The atmosphere is to bright and cheery. Make it darker. And it doesn't make that much sence to have really greeen grass with a dead tree. But if your not headed for realism, then at least create a darker atmosphere to give that tree a more daunting look.
To change the atmopshere, i first suggets making the fog darker.