It may just be he needs more time. They aren't fighting, and are at least keeping each other company, forming a relationship, even if it is strained. Poor Olaf has trust issues, and that takes a long time to over come. I think if you are patient and keep doing what you're doing, they will eventually become friends. Olaf may always be a bit on the fearful side, but that isn't the worst thing
Stay hopeful, you are giving Olaf the best home he can have.