hi Zephyr. Well I have to admit, I am not familiar with identifiers you have used. It very well could be my inexperience.

for starters, I removed a lot of else's and used halts instead.
I stopped at the line you had trouble with because I was a little perplexed.
Code:
on *:text:!cut yew*:#RuneScapeLife:{
  if (!$($+(%,$nick),2)) { notice $nick You do not have an account! Type !create to make one. | halt }
  if ($($+(%,$nick,.WcXP),2) < 50000) { notice $nick You do not have enough Woodcutting experience to cut a Yew Tree. (50000 Woodcutting Experience minimum.) | halt }  
  if ($($+(%,$nick,.Busy),2) == On) notice $nick You need to wait before you can cut another Yew Tree!
  if (!$($+(%,$nick,.Axe),2)) { notice $nick You do not have an Axe! | halt }
  else {
    if (!$($+(%,$nick,.RuneAxe),2) == Yes) notice $nick You begin to chop a Yew Tree... 
    set % $+ $nick $+ .yewlogs $rand(1,15)
    timer 1 5 notice $nick You have chopped $($+(%,$nick,.yewLogs),2) Logs.
    inc % $+ $nick $+ .Yews $($+(%,$nick,.yewLogs),2)
    inc % $+ $nick $+ .WcXP $calc($($+(%,$nick,.yewLogs),2) * 175)
    unset % $+ $nick $+ .yewLogs
    set % $+ $nick $+ .Busy on
    timer 1 10 unset % $+ $nick $+ .Busy
    else { 
      notice $nick You begin to chop a Yew Tree...
      set % $+ $nick $+ .yewlogs $rand(1,10)
      timer 1 5 notice $nick You have chopped $($+(%,$nick,.yewLogs),2) Logs.
      inc % $+ $nick $+ .Yews $($+(%,$nick,.yewLogs),2)
      inc % $+ $nick $+ .WcXP $calc($($+(%,$nick,.yewLogs),2) * 175)
      unset % $+ $nick $+ .yewLogs
      set % $+ $nick $+ .Busy on
      timer 1 10 unset % $+ $nick $+ .Busy
    }
  }
}


I will touch on the identifiers last. Lets assume all your comparisons are correct.

At the line you marked you say...
else {
if (variable == Yes) {
notice $nick chop tree
set rand var
start timer
inc var
inc var
unset var
set var
start timer
else { <its this else, else what? It needs an if statement to say else.

Ok now I am not familiar at all with (!$(%var,2) == yes)
ex: (!$($+(%,$nick,.RuneAxe),2) == Yes) Please explain this to me so I can learn this way.

Also, in my experience using variables, its best to use evaluation brackets. [ ] I start a variable by a static name and then attach the dynamic info to it.
Lets use $($+(%,$nick,.yewLogs),2) as an example.
%yewLogs. [ $+ [ $nick ] ] this is how I am used to writing dynamically named variables. I am open to learning new ways.