This is talking about elemental shape. Elemental shape should not be changing your race to Outsider. Elementals, while not native to the prime, are a very specific breed of creature and have their own subrace.

Banishment is also very specific in what it says it works on. A PC that is an elemental should not be affected.

I can only think of one non-summoned, non-shapeshifted elemental on the server. And I'd hope it's immune to Banishment. Summoned elementals are subject to Banishment, not on the basis of subrace, but because they're summoned and that's how Banishment works.

So now we will have peculiar cases of elementals who are definitely not from the material plane not being banished, but their native-outsider part-human offspring being banishable?

Things like this are so confusing they make me want to cry.

Marids are the water genies, and Dao are the earth genies. Sylphs can also produce genasi, and tritons can too (air and water respectively). There are a few other cases as well.

But actually huh I checked up on this, and here's the weird thing: The child of a djinn or other outsider with ties to the elemental planes is apparently called a half-elemental (which I can't find the statblock for). But presumably they're still outsiders, but they're still called half-elementals. Genasi apparently can only descend from aforementioned outsiders. That's what confused me.

Elementals can't breed, so no, not much comes from them personally, but hanging around on an elemental plane while pregnant is another matter entirely. Genasi are created from that as much as anything.

Origins of the Planetouched: If you ask someone how the Planetouched got that way, most folk will tell you that it's due to their anscestry. If you go back far enough in a Tiefling's family tree, they say, you'll find that one of their anscestors was a Baatezu or a Yugoloth or some other kind of lower planar creature. Likewise, if you go back far enough in an Air Genasi's family tree, you'll find that one of their anscestors was a native of the Elemental Plane of Air, such as a Djinn. And sure enough, that's the most common way to become Planetouched.
But that ain't the only way...

Each one of the Inner and Outer Planes has permanent settlements in it. No matter how deadly a plane might be, you can count on there being at least a few permanent residences there. It might be a huge metropolis like the City of Brass, or it might be a town like Madhouse on Pandemonium, or it might be a small citadel like the Dustmen's floating retreat on the Negative Energy Plane. Even the Plane of Vacuum has a few small settlements of barmy sods who live there.

Each one of the Inner and Outer Planes also has a fundamental nature that pervades and suffuses every particle of every location within the plane. The Plane of Smoke, for example, isn't simply an infinitely big space filled with smoke. It's an infinitely big space filled with the idea of smoke. And while a basher living on the Plane of Smoke may be able to keep the smoke out of his kip with magic, there's no magic around that can keep out the idea of smoke. Because the idea of smoke is what the Plane is all about.

For those who have already been born, being constantly suffused with the fundamental nature of a plane doesn't have much effect. The process of being born tends to give a person a sense of self that's hard to change. Even babies fresh from the womb are already starting to define themselves on a very basic level. And once you start defining your sense of self like this, the fundamental nature of the plane you're living on won't have much affect on you.

On the other hand, children who are still developing in the womb don't have this sense of self. As a consequence, it's possible for a child to literally be touched by the plane while developing in the womb. Humans are more likely than any other race to have this happen, but it can happen to any race. And even for humans, it's a rare occurrence -- the overwhelming majority of the folks born on the planes are of the same race as their parents, and show no signs of being Planetouched. But every so often, two otherwise normal parents will produce a Planetouched child. That's just the way of the Planes.

[Note: The origins of the Planetouched as explained on this page presumes the existence of the Para- and Quasi-Elemental planes as described in various 1st Edition and 2nd Edition D&D products. If you are using a cosmology which lacks the Para- and Quasi-Elemental planes (such as, for example, the default 3rd Edition D&D cosmology), then click here.]

I'm pretty sure it's either Planescape lore or something from Dragon, but heck if I know off-hand. It's certainly not Amia homebrew, though.