[RPG] What to do when surprise and a high initiative roll conflict with the narrative

The combat begins when the Darkmantle decides to attack. If the players don't notice the Darkmantle at the beginning of combat, they are surprised:

Any character or monster that doesn’t notice a threat is surprised.

So, thanks to False Appearance, the Darkmantle has a Surprise attack. Also, when the combat starts, the adventurers don't know that they're in a combat situation and so are not scanning the entire space all the time, unless previously stated (they are not combat-aware), so the Darkmantle remains hidden until its turn. However, all characters that are higher in the initiative order than the Darkmantle are no longer surprised at the end of their turn (or, better say, the "Surprise" property is no longer applied to them)! They are thus able to take reactions. For reference, this answer to another question (also linked in the comment of this question) breaks it down in full detail.

The Unseen Attacker advantage, however, depends on the DM's ruling, as the RAW are not specific about this.

As far as Darkmantles go, they could approach their target unnoticed. They don't have to fly, they can just drop down. One could reasonably fall unnoticed as easily as dropping a curtain on top of someone. Even if someone would notice the creature as it was falling, they'd only get enough time to look up and see the horrid array of teeth approaching swiftly.

If you still believe your Darkmantles are unable to automatically Batman your PC's, then a Stealth check is appropriate, and should be made during the Darkmantle's Move action. In either case, the Surprise Attack persists, it is only the Unseen Attacker advantage that is at stake.

Keep in mind that the target of the attack must be taken into account. If the Darkmantle attacks a character that was higher in the initiative order, the character can take reactions (like Tempest Cleric's Wrath of the Storm), regardless of whether the Darkmantle remained hidden during its movement or not. The very act of attacking reveals it:

If you are hidden—both unseen and unheard—when you make an attack, you give away your location when the attack hits or misses.

However, if the trigger for their reaction is before the attack, the Darkmantle's visibility has to be taken into account.

If the Darkmantle attacks a character that's lower in the initiative order, the character won't be able to react until the end of its own turn. So, even if his reactions trigger "on hit", he won't be able to use them. However, if the characters that went before the Darkmantle have a reaction that triggers "when an ally is attacked", they can take that reaction (again, because the attack reveals it).

There is only the final, special case to consider, where the Stealth check is only partially successful and one or more characters notice the Darkmantle as it moves in to strike. It is fully within their ability to warn the others of the threat, as they can talk out of turn (within reason). However, as it's the Darkmantle's movement that triggers the Stealth check, the players that were surprised at the moment of the attack still remain surprised. Whether the darkmantle retains its Unseen Attacker advantage or not is up to the DM and his opinion on how fast a character can react to a warning.

From a role-playing perspective, if the Darkmantle remains unseen the adventurers either didn't notice the attack until the moment it hit, or they noticed it too late to do anything about it (including removing the advantage).

Here's an example of how that could be acted out:

(A PC walks under the Darkmantle and it decides to attack.)

DM: As you explore the dark cave, you feel a slight chill up your spine... Roll Initiative!

Player: Why? Do we see anyone here?

DM: Not yet.

(Initiative order is set. )

DM (to the players at the top of the initiative order, before the Darkmantle): You are not aware of any threats and proceed as you were.

(The Darkmantle's turn comes. It makes its optional Stealth check... and remains hidden. It swoops down on its unsuspecting target and rolls its attack with advantage... success!)

DM: Alright... Aldore, your head is suddenly wrapped in a curtain of flesh and you feel piercing teeth gnawing at your cranium. You take XX damage!

(DM now describes the attacker, and the battle continues. The characters that haven't had their turns yet are still surprised. When all turns resolve, the combat continues as usual from the top of the initiative order.)

Now, if the creature missed the attack (either by lacking or despite the advantage) you could have it be because the character noticed it and dodged in the last second, or you could make the Darkmantle comically flop on the ground in the middle of the party. Your choice :)

If you read the following paragraph in the PHB after the section you mentioned on turn order (pg. 189) you'll see it says:

If you’re surprised, you can’t move or take an action on your first turn of the combat, and you can’t take a reaction until that turn ends.

On top of that, it's important to note that

A round represents about 6 seconds in the game world. (PHB 189)

So in this case it translates to:

1. Warrior takes his turn. He can choose to ready an action here to use his reaction later to attack Elf2 when the Rogue attacks Elf1. Note that the Warrior can move into range if necessary and will not affect surprise as surprise is determined before turns are taken.
2. Elf2 does nothing and is no longer surprised. He can now take reactions. If the rogue attacks him there are no bonuses related to surprise added to that attack.
3. Rogue takes his turn. When the Rogue attacks Elf1, the Warrior uses his readied action.
4. Elf1 does nothing and is no longer surprised. He can now take reactions.
5. Combat proceeds as normal using the same initiative order. (Readying an action does not change initiative order so it will still be Warrior, Elf2, Rogue, then Elf1)