Hi Tom,
Yes VRML should be quite capable of handling that kind of task.
From the way you describe your project, the hardest part will be the foliage. Trees/foliage are notorious for producing lots of polygons if it is all strictly geometry (in any 3d type set up not just VRML). You probably want to look at some of the tricks used by the game makers to keep the polygon count down.
However it sounds pefectly doable
While its not exactly what you are after, this piece of VRML I built a few years back has 18 birds flying around in it :
http://www.3dworlds.ca/castle2/castle2a.wrl
It runs happily in the Blaxxun Contact VRML plugin ... never tried it with any other VRML players.
griff