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Yes, you are missing three critical facts:
1) Yes, you can literally chop wood with the Woodcutter's Axe (a tool).
2) You mainly need wood for arrows, and you can make arrows using the alternative recipe with only a bit of wood and the rest broken arrows. (Important for early game).
3) You can dismantle weapons and armor for components at the blacksmith. Some of them return a lot of wood, and are also very cheap so no point in selling them (like rusted armor and weapons). They also give metal, which can be used to make higher-quality steel arrows (that also use less wood for crafting).
Even as an archer, I never had problems with wood in the game.