I actually think this could work as a play with music (a la
Peter and the Starcatcher or
Choir Boy). Like
@mickeyfan5534 said (and
@AceAstro confirmed), take the same style as
War Horse to bring the elephants to life (but in the case of Pink Elephants, I'd prefer bunraku or some other outlandish form of puppetry). Smaller puppets would be used for Timothy and the crows (
not black stereotypes this time around). As for the "play with music" concept, I think this could be a one-act play with only three songs from the film: "Baby Mine", "Pink Elephants on Parade" and "When I See an Elephant Fly". "Baby Mine" is sung early on as a lullaby, thus making the reprise during Dumbo's visit to her cell all the more heartbreaking.