I just experimented, instancing trees also works when they have leaves (which are instances themselves, so this could have been a problem)
Too little ram for renders though ;(
Using the tree itself for an instance for its leaves, lead to a crash
Maximus: The ICE tree for the instance is like this: I used a primitive->pointcloud->grid, randomized the points in XZ axis a bit, and tweaked a little terrain elevation with the move point tool.
Then attached an "instance shape" node with the tree point cloud, a "set particle size" and a "set particle rotation", last two fed with random values.
It's important to go into the "particle display" property of the grid pointcloud, and set it to something else than "automatic", otherwise you'll have OpenGL performance problems.