burl wood irl is basically a tree tumor that has an absolutely beautiful pattern on the inside and they can sell for lots of money. you've probably seen them before, most of the time they are big dark lumps sticking out of the tree. my idea is that, just like bee hives, they have a rare chance to generate on trees in groups of 1 to 4, and on larger trees (2x2) they could be in 2-10, the larger the amount, the rarer it is. the tree with a burl on it will also have a decent chance of having more than 1, although that would be rarer. just like building with ancient debris, they would really only be used for expensive but beautiful decoration as a way to flex or show how much work you've put in. another idea for them would be that villagers would buy them for lots of emeralds due to their rarity. there could also be a small detail where they are more likely to generate in humid biomes like swamps or jungles (most irl burls are caused by moss or bug infestations so taiga biomes would do good too).
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