Like I said, if you think it's symbolism it probably is and if you don't think it's symbolism... it still probably is. Disclaimer; Thranduil isn't this mean, he's actually a pretty nice guy. Don't take any characterizations presented right now to heart.
At first Bilbo was just confused. Thorin Oakenshield and Mirkwood weren't two things one automatically put together, so any notions of this all being in his head went out the window.
Why was Thorin standing in front of Thranduil's throne? They'd already been through this, they had been working on an alliance after the battle last he had heard- did something go wrong?
Bilbo figured that something must have because Thorin didn't seem to be there of his own free will if the guards blocking his exit were anything to go by. Did this happen the first time around? He hadn't found Thorin in the dungeons until several days after he had found the others- nearly two weeks after they'd all been captured and probably a few more days on top of that assuming the elves had caught Thorin before everyone else. There was a whisper in is mind that was telling him that this situation was much more dangerous than he thought.
Looking closer Bilbo got the impression that this was the first time around. Or something similar. Thorin was coated liberally in cobwebs, his coat torn and ragged from overuse with little care. His face seemed drawn and haggard, as if he was repeating a conversation he'd already had several times before.
Perhaps that was the case; even Thranduil seemed to be dully going through the motions.
Bilbo was broken from his observations when Thorin began yelling in Khuzdul- Thranduil had clearly said something to anger him enough to eliminate what little diplomacy there had been.
Was this what he had missed skulking around in the dungeons all that time? Was he being forced to relive parts of the Quest for some reason? Bilbo looked to the Shadow for answers only to find it gone.
His anxiety peaked, confusion that had already been running rampant now mingled with fear- just because one elf hadn't been able to see him didn't mean all of them couldn't, and if he still had to play his role of jail-breaker, being caught without his ring could only spell disaster. And what if he was permanently invisible? If this was real, would he be stuck in Thranduil's kingdom with a Thorin who couldn't even see him for the rest of his life?
It seemed that only the Shadow could tell him, though it had evaded his questions earlier, and now even it had disappeared into the mist!
Frozen with indecision Bilbo had to quickly stumble out of the way when Thorin was herded past him and out the door by the guards.
They had overlooked him completely.
With a sinking feeling in his gut, Bilbo followed them down, watching as Thorin was pushed into the same cell as last time. The guard locked his cell, but in an uncharacteristic moment of elvish clumsiness, dropped the keys.
Bilbo impulsively took the opportunity to snatch them up, only to find that to his horror, his hand passed straight through the keys as if they weren't even there.
What was happening? He'd only ever been invisible, not intangible- nonexistence was not part of the deal here! He had no ring, he had no plan, he wasn't even sure if any of this was even real for Valar's sake! Clearly this had to be the Shadow's fault, it seemed to be the crux of this entire adventure away from his Oak tree and it must have known what it was doing.
If only Bilbo had any idea where it went.
He let out a quiet screech when he turned around only to find it lurking in the corridor behind him as if waiting patiently for him to pay attention.
"Why-" He gasped. "Why must you sneak about like that, you're going to give me a heart attack!"
The shadow just looked at him doubtfully. How it did so without eyes was a bit of a mystery, but Bilbo ignored it.
He deflated as his anger faded as quickly as it had come- emotions were hard here, but anger seemed to come more easily than most. "Why are we here?" He whispered miserably.
"Because you must choose."
"Choose what!?"
Predictably he got no answer, but he couldn't muster the energy to be mad. Bilbo didn't want to choose. He'd been making choices since he opened the door to smial to reveal the first dwarf he'd ever seen in his life- and he was fairly certain that at least half of them had been very bad decisions.
He didn't regret coming on the quest- he knew he'd never regret that- but his own inexperience and stubbornness had caused them all more than his fair share of trouble.
There was that time he had gotten cocky about learning to ride a horse and fell off his pony into a stream- losing some of their food in the process, the whole situation with the trolls, nearly getting eaten by wargs right after that because he was foolish enough to look behind him necessitating Thorin having to come haul him along by the back of his jacket.
Then there was him getting lost in the goblin tunnels and holding everyone up when they argued about whether to look for him, wasting time in Mirkwood and failing to find a better way out as his dwarves had made sure to complain about vigorously when they finally washed ashore, holding them up again in Laketown when he got sick- not strictly his fault, but he had made the mistake of taking a plunge into the river instead of getting himself a barrel.
He didn't even want to start on what happened in the mountain, telling Smaug not to hurt the lake-men surely was what sealed their doom, and his slapdash attempt to stop a war failed anyway, as well as estranging all his friends.
How could he be asked to make a reliable decision now, when it seemed the lives of his friends once again hung in the balance? His bids toward peace had been temporarily placating at best, what was the guarantee it would be as successful this time and not come to violence instead?
Maybe violence would be better. If he didn't start it then someone else would; why not take the advantage while he could? No. He was a hobbit no matter how unrespectable he now was- hobbits weren't violent, they didn't like war and he most certainly didn't either.
The shadow seemed patient as Bilbo did his best to compose himself and shake off the disconcerting thoughts, it removed the handkerchief hanging forgotten from his pocket and handed it to him as one would when consoling a crying relative who you didn't much like but needed to be on good terms with anyway.
It was more difficult than he though to put himself together when he kept glancing over and seeing Thorin looking so sad and defeated in his cell.
It was a sight Bilbo had become distressingly familiar with during their first time in Mirkwood- it got better after he had revealed himself and assured Thorin of the safety of the rest of the company, but anytime Bilbo had happened to pass by while he was wearing the ring he would see Thorin slouched there with his defenses down and the struggle of their journey truly showing on his face.
It was the first time Bilbo had seen him when he wasn't doing his best to pretend; to pretend that he had complete confidence in their success, that he wasn't worried sick about his nephews or that he didn't actually feel the weight of a lost kingdom on his shoulders every minute of the day.
Thorin was many things but a good actor was not one of them once you got to know him.
Once they were walking again Bilbo found that he was once again following the Shadow, this time past the throne room and into some mix between a conference room and a library. There were quite a few elves milling about, including Thranduil and his son- the king holding a glass of Dorwinion wine and Legolas whispering that 'wasn't it too early for that much?'
Ignoring his son's concerns, Thranduil downed the wine and swept to the front of the table- apparently the cue for whatever meeting they were having to start.
Bilbo and the Shadow lingered by the door- the Shadow didn't seem to care so long as they were in the room and Bilbo was still wary of being caught out despite his newfound intangibility.
There was a strange tension in the air, one that had the potential to become either dangerous or distressing and Bilbo wasn't sure if it was just him or the overall atmosphere of the room. He was on edge and half convinced he was hallucinating vividly, but that didn't mean that he was about to not pay attention- as such, as the elves all settled in to whatever meeting they were supposed to be having he came to stand and watch intently from behind Thranduil's chair.
The king's commanding voice filled and silenced the room. "As you all well know, we have twelve dwarrow in our dungeons, twelve dwarrow from Erebor- kin of Thorin Oakenshield."
Several of the older (maybe, the whole 'immortality' thing made it hard to tell) elves sneered at the mention of Thorin.
"We even have Oakenshield himself in our grasp and at your suggestion, we have convened to discuss the merits of… permanently eliminating him."
Bilbo gaped and the Shadow smiled as Thranduil's court began to discuss murdering the King under the Mountain.