You should find pipe dope or teflon tape around the threads, but not glue. I expect that whomever put that shower arm in wanted to tighten it that extra 7/8 of a turn to get the shower arm straight and pointed in the right direction, and that's why it's so tight.
Did you try Redwood's suggestion of cutting through the elbow with hot metal? I was thinking that if you have a small electronics soldering iron, you could melt through the plastic with that, too.
all it did was chunk up the plastic to the point the file hit the threads of the elbow & buggered them up a tad
Thank goodness you had the good judgement not to keep jamming that file into the elbow and twisting it once it was already hitting the brass threads of the elbow.
I doubt that anyone would have glued the shower arm in, tho. In the unlikely event that you have to start looking for a Plan "B", may I suggest the following:
1. Go to:http://www.kissler.com
Kissler is a plumbing wholesaler in New Jersey who carries a lot of stuff that is no longer available from the original manufacturers. They contact the offshore companies that made the parts for the original manufacturers and have them make those same parts for Kissler. In many cases, they fabricate the parts themselves, such as brass spindles for cartridges or seats for faucets that have been obsolete for years.
2. On the Kissler home page, click on the "Escutcheons, Sleeves and Trim" catalogue to download that PDF file. It's a 1.2 MB file that contains pages 293 to 314 of the Kissler Catalogue. The page numbers are found in the bottom right corner of each page.
3. At the top of page 303 in that PDF file, the middle escutcheon is 5 inches tall and has a 3/4 inch hole toward the top of it. It was originally made for American Standard.
You could enlarge the hole in your wall from the tub side. Simply buy a coping saw blade and slip it into the wall at the shower elbow. From what I can see, there's plenty of room to get a coping saw blade into that gap. Draw the hole you want to make on the wall and insert the blade so the teeth face toward you and cut on the pull stroke. Use a small pair of Vice Grips to hold the blade.
Now, just hire a plumber to unsolder the old shower elbow and solder a new one on. (I'm presuming you don't solder.)
You could then slip this escutcheon (part # 42-4155) over the new shower arm, and the escutcheon would cover the enlarged hole in the wall. Then just use silicone caulk to seal around the perimeter of the new escutcheon. I'd leave the bottom of the escutcheon un-caulked to allow any water that might get into the escutcheon to leak out.
Kissler has a $250 minimum order, but they have lots of companies that order from them regularily, including Handyman's Inc. close to Minneapolis, Minnesota.http://handymansinc.com/
Kissler's Customer Service should be able to tell you of someone closer to you that orders from them on a regular basis. You might have to wait a few weeks for that company to put together an order of $250 or more in goods, but when I've ordered from Kissler through Handyman's, it didn't take longer than 2 weeks. You could just tape a plastic bag over the hole for the interim.
Hopefully, it won't come to this, but it's good to have a back up plan in case you don't make any progress removing that plastic.