I would go to the hill, a very distant second option would be to settle in place, I would never settle on the truffles in this scenario.
If you go on the hill you will have three unique luxuries in the capital later for duplication (coco, tea, truffles). Technically you would have that if you settled on the truffles to but since ivory and truffles are the same improvement type I wouldn't waste a settle on top for that. It's just one improvement while the others are a chop and a build.
If nothing else fantastic show up a second city either by the lake on the desert hill, or somewhere close around there. As long as it's in range of the ivory.