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Is it connected with an oak tree?

I don't think so :P

does the word alon translate as an oak?

No, it's an expression for someone who gets "upgraded" in terms of social status.
από τα αλώνια, στα σαλόνια (apo ta alonia, sta salonia) = literally it means "from the threshing floors to the great halls" :P

This is a very interesting combination of consonant words.
We have a similar combination: "iz gryazi v knazi" - "from the dirt to the Kings".

alonia-salonia
gryazi-knazi

: )

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