I always thought of a pilcrow just as a character that you used to mark a new paragraph. In doing some research I quickly learned that its main purpose is to denote paragraphs, but also has different uses for different medias. What I focused on was that back in the middle ages before the idea of paragraphs were in place, the pilcrow was used to mark a new train of thought. (Below I have a picture of the pilcrow itself and an image containing the evolution of the pilcrow, images borrowed from Wikipedia.)
In William Morris' book design, it is very clear why he used such a design of leaves to take place of the pilcrow. Morris being the leader of the Arts and Crafts Movement , looked back to the beauty of the middle ages which used pilcrows to mark a new train of thought, but made it his own using a leaf. We learned that the Arts and Crafts movement was all about everything having detail and being beautiful, which explains why such ornate detail was designed in this book. Unfortunately, I was unable to find an explanation why Morris used a leaf design, some ragged and some smooth, to take place of the pilcrow, but knowing what Morris stood for it makes a lot of sense.