There's actually two questions here: one is a big-picture view, about how Elves would "adapt to modern society", the second is more specific: "would they withdraw from technology?" I will mostly explore the first question, because (1) it matches the title and (2) the second question (technology adoption) can only be answered as it relates to the larger context of the first (socioeconomic adaption). So: How will a proud and long-lived, but small and fragmented, minority group of Elves adapt to modern (mostly human) culture?
To answer this question, one really needs to take a historical perspective. Unless the Elves were suddenly scooped up from Old "Middle Earth", and suddenly dropped off into Modern "Middle Earth", they will not be adapting to "modern" society all at once. They will, instead, be constantly re-adapting to a society that is changing faster (or at least differently) than they are. This adaptation will be an on-going process, and will also be a two-way street. As Elves are adapting to a changing society, that changing society is adapting to their adaptations. So an important corollary question is, how does human society (throughout history) react to Elves. Because then you can ask how the Elves adpat to this reaction, and what the counter-reaction to that is.
Sidenote: Since I've written this, you've added a stipulation that humans generally respect the Elves, and largely don't come into contact with them. I think that at a modern tech-level, with satellites and global transportation and communication networks, the later will be relatively difficult to justify. Especially if they comprise as much as 5% of the world's population (roughly equivalent to the entire U.S. population). It's true that there are still uncontacted people groups in the world today, but these are rapidly disappearing, and all are extremely tiny (on the order of a few hundred people) and incredibly remote (mostly in South America, South East Asia, and Papua New Guinea). While some people believe we should let them be, others (such as missionaries, anthropologists, business developers, or tourist guides) will seek out these people.
As for the idea that humans will generally respect the (largely unknown) Elves, I think this is difficult to justify from a historical perspective. One has only to look at real-life history to see analogues for how minority groups who retain a unique cultural identity are treated. Sadly, it is rarely positive, and is often filled with suspicion, fear, and even outright violence. As a disclaimer: I hope I don't inadvertently offend anyone with this post; these can be sensitive topics, and I'm painting with an overly-broad brush, and without expert knowledge on the topic.
Given your parameters, it seems inevitable that, at least at some point in history, there will have been an "us vs. them" mentality between Men and Elves (this is even present to an extent in Tolkien). It's quite probably that at least some Men would even view Elves as less-than-human (and almost certain that many Elves view Men similarly). That may still be prevalent in your present, or folks may be trying to move past that. But cultural and racial grudges seem to last a very long time -- easily multiple centuries, even with our puny human lifespans (look at the Middle East conflict). With longer Elven lifespans, these grudges will probably be longer-lived. However, it's also important to remember that an individual's decisions are not bound by their race, nationality, or culture. That is while a majority of Elves (or Men) may act in a certain way towards the other, there will, of course, always be exceptions (to suggest otherwise could be construed as being racist!).
Assuming your Elves want to stay withdrawn, it may not actually be their choice. At some point, the pride of Men will probably drive them to seek physical resources that the Elves have -- timber, ranching lands, oil reserves... If the two are on roughly equal terms, they may be able to trade (as between Mirkwood and Lake-Town), but if that fails, there may be war between them. However, if the sides are too vastly mismatched (because the Elves have not adopted the latest technologies as quickly, or have a substantially smaller population, or are to politically fragmented) than the weaker side may be forced to retreat. Consider the deforestation, ranching, and mining in South American rainforests, but replace the indiginous peoples being displaced with Elves. How many will choose to fight to keep the forest (possibly being labeled terrorists, radicals, or nationalists), vs. withdrawing further into it (and being called isolationists). How many will grow tired of the conflict, and move to the human cities, looking for better jobs? A similar example was the United States' expansion, and the shameful mistreating of Native Americans in wars and forced relocations into reservations. In Europe, we can look at the mistreatment of minority groups such as Cagots, Romani, and Jews, which, on the bad side, can range from general social stigma, to disreagard and contempt, to outright Holocaust.
And then there's the question of manual labor. At some point, your society will have gone through a population boom and an Industrial Revolution. But before machinery becomes widespread, cheap manual labor may well have been an important commodity. In the real world, this led to utilizing slave labor, sometimes from indigenous people groups, and sometimes imported -- most famously in the form of African slaves. This has had widespread and long-lasting effects on the U.S., not just in terms of raical tensions, which still exist, but also in terms of cultural development. For example, in music, gospel spirituals, ragtime, jazz, blues, latin-american, hip-hop, and rap have all come to some extent from this blending of Western and African cultures. If your Elves are incapable of defending themselves, they may be similarly exploited as slave labor. But there may also be a corresponding cultural blending that occurs Interestingly, this slavery option is an approach that Dragon Age explores with its Elves, essentially placing them in urban slums, and having them be treated as sub-human..
Another question is economics. Third world nations aren't usually third world because they shun technology (even if they may have initially done so), but rather because they are stuck in poverty and can't afford all the high-tech trappings of a modern life. If your small groups of Elves are successful at remaining isolated like some South American tribes, they likely won't have the means or standard of living to afford much technology. If they become only partially integrated, as a despised subculture in slums, they might be able to afford an old TV and a used clunker of a car. If they become fully integrated into an advanced west-like society, they may well have a close-to-equal standard of living and access to technology. In other words, the level of social integration may be the largest determiner of economic means.
Yet another factor to consider is that, when a group decides to stay withdrawn, a recurring theme is a generational gap. Each individual of each new generation has to make an individual choice (often during adolescence to young adulthood) to stay loyal to the "old ways", or join the "new ways". Often you hear about tribes shrinking as the youth move away and rejecting their parents ways, in pursuit of what is perceived to be a "better" life, or at least a better "potential" (compare this with Arwen's decision to stay with Aragorn). Granted, with longer-lived elves, this process will likely be much slower, but I see no reason it would not occur eventually. However, this can also lead to a feeling of not fitting into the new culture, or being stuck between worlds, as it were, or even looking for unique ways to integrate the old and new aspects of their culture.
There is a surprising counter-example to the above, however, to be found in the Amish. You would expect them to be shrinking as the younger generation moves away, but that is not necessarily the case. However, many Amish communities have apparently become somewhat more tolerant of technologies (it's up to each community to decide), even while still lagging the mainstream. Furthermore, I'll speculate that for whatever reason, the Amish seem to project a certain idealized, idyllic image that allows us to see them somehow as a "wholesomely eccentric self" rather "threateningly different other". Perhaps this is a niche your Elves could fill, although I tend to think their differences would make that difficult.
So when it comes to technology for the Elves, the question isn't so much "will they adopt new technologies" -- it's "will they adopt them fast enough to keep pace with human society." Because if they don't at least try to keep up, it seems likely that they would be destined to become a repressed and mistreated subculture, swallowed up within that larger society, at which point they gradually become assimilated, and eventually end up using that technology anyway.
