Yes, the items can be rotated in any axis, but you must limit the range to avoid collisions with the surface. It's not possible to compute automatically the range, because that would need a complete physics system.
I suggest that you take a leaf object and rotate it on the viewport along the X/Y axes, to see visually what is the maximum angle before collisioning with the XY plane. Then, use these values in Forest. The values will depend of the geometry and pivot position.